REG - Kingfisher PLC - Final Results - (Part 2 of 2) <Origin Href="QuoteRef">KGF.L</Origin>

KingfisherAnnouncement

22/03/2017 07:07

RNS Number : 1429A
Kingfisher PLC
22 March 2017
KINGFISHER PLC
Consolidated income statement

Year ended 31 January 2017









2016/17
2015/16


Before
Exceptional

Before
Exceptional



exceptional
items

exceptional
items

 millions
Notes
Items
(note 4)
Total
items
(note 4)
Total
Sales
3
11,225
-
11,225
10,441
-
10,441
Cost of sales

(7,050)
-
(7,050)
(6,545)
-
(6,545)
Gross profit

4,175
-
4,175
3,896
-
3,896
Selling and distribution expenses 

(2,758)
21
(2,737)
(2,666)
(308)
(2,974)
Administrative expenses

(687)
(5)
(692)
(567)
(15)
(582)
Other income

19
7
26
26
157
183
Share of post-tax results
of joint ventures and associates

1
-
1
3
-
3
Operating profit 

750
23
773
692
(166)
526
Finance costs

(21)
(6)
(27)
(22)
-
(22)
Finance income 

13
-
13
8
-
8
Net finance costs
5
(8)
(6)
(14)
(14)
-
(14)
Profit before taxation

742
17
759
678
(166)
512
Income tax expense
6
(143)
(6)
(149)
(167)
67
(100)
Profit for the year

599
11
610
511
(99)
412
















Earnings per share 
7






Basic



27.1p


17.8p
Diluted



27.0p


17.8p
Adjusted basic



24.4p


22.0p
Adjusted diluted



24.3p


22.0p
Underlying basic



25.9p


22.0p
Underlying diluted



25.8p


22.0p








Reconciliation of non-GAAP underlying and adjusted pre-tax profit:
Underlying pre-tax profit



787


686
Transformation costs before exceptional items

(44)


-
Adjusted pre-tax profit



743


686
B&Q China operating loss



-


(4)
Financing fair value remeasurements

(1)


(4)
Exceptional items



17


(166)
Profit before taxation



759


512
The proposed final dividend for the year ended 31 January 2017, subject to approval by shareholders at the Annual General Meeting, is 7.15p per share.
Consolidated statement of comprehensive income
Year ended 31 January 2017



 millions
Notes
2016/17
2015/16
Profit for the year

610
412
Actuarial (losses)/gains on post-employment benefits
9
(50)
19
Tax on items that will not be reclassified

11
(8)
Total items that will not be reclassified subsequently to profit or loss

(39)
11
Currency translation differences 



Group

390
1
Joint ventures and associates

(1)
(3)
Transferred to income statement

-
(7)
Cash flow hedges



Fair value gains

52
24
Gains transferred to inventories

(60)
(50)
Available-for-sale financial assets



Fair value gains

5
2
Transferred to income statement
12
(7)
-
Tax on items that may be reclassified

2
8
Total items that may be reclassified subsequently to profit or loss

381
(25)
Other comprehensive income for the year

342
(14)
Total comprehensive income for the year

952
398
Consolidated statement of changes in equity
Year ended 31 January 2017


Attributable to equity shareholders of the Company

 millions
Notes
Share capital
Share
premium
Own shares held
Retained earnings
Other reserves
Total
Non- controlling interests
Total equity
At 1 February 2016

361
2,218
(24)
3,637
(6)
6,186
-
6,186
Profit for the year

-
-
-
610
-
610
-
610
Other comprehensive income for the year

-
-
-
(39)
381
342
-
342
Total comprehensive income for the year

-
-
-
571
381
952
-
952
Share-based compensation

-
-
-
15
-
15
-
15
New shares issued under share schemes

-
3
-
-
-
3
-
3
Own shares issued under share schemes

-
-
7
(6)
-
1
-
1
Purchase of own shares for cancellation

(9)
-
-
(150)
9
(150)
-
(150)
Purchase of own shares for ESOP trust

-
-
(6)
-
-
(6)
-
(6)
Dividends
8
-
-
-
(230)
-
(230)
-
(230)
At 31 January 2017

352
2,221
(23)
3,837
384
6,771
-
6,771










At 1 February 2015

369
2,214
(26)
3,652
11
6,220
10
6,230
Profit for the year

-
-
-
412
-
412
-
412
Other comprehensive income for the year

-
-
-
11
(25)
(14)
-
(14)
Total comprehensive income for the year

-
-
-
423
(25)
398
-
398
Disposal of B&Q China 
12
-
-
-
-
-
-
(10)
(10)
Share-based compensation

-
-
-
11
-
11
-
11
New shares issued under share schemes

-
4
-
-
-
4
-
4
Own shares issued under share schemes

-
-
18
(17)
-
1
-
1
Purchase of own shares for cancellation

(8)
-
-
(200)
8
(200)
-
(200)
Purchase of own shares for ESOP trust

-
-
(16)
-
-
(16)
-
(16)
Dividends
8
-
-
-
(232)
-
(232)
-
(232)
At 31 January 2016

361
2,218
(24)
3,637
(6)
6,186
-
6,186
Consolidated balance sheet



At 31 January 2017







 millions
Notes
2016/17
2015/16
Non-current assets



Goodwill

2,399
2,397
Other intangible assets

308
276
Property, plant and equipment

3,589
3,212
Investment property

24
25
Investments in joint ventures and associates

23
23
B&Q China investment
12
-
62
Post-employment benefits
9
239
246
Deferred tax assets

28
11
Derivative assets

54
43
Other receivables

8
7


6,672
6,302
Current assets



Inventories

2,173
1,957
Trade and other receivables

551
568
Derivative assets

36
56
Current tax assets

6
5
Short-term deposits

-
70
Cash and cash equivalents

795
730
Assets held for sale

-
6


3,561
3,392
Total assets

10,233
9,694




Current liabilities



Trade and other payables

(2,495)
(2,369)
Borrowings

(14)
(138)
Derivative liabilities

(26)
(6)
Current tax liabilities

(141)
(66)
Provisions

(63)
(69)


(2,739)
(2,648)
Non-current liabilities



Other payables

(50)
(53)
Borrowings

(184)
(179)
Deferred tax liabilities

(282)
(333)
Provisions

(99)
(208)
Post-employment benefits
9
(108)
(87)


(723)
(860)
Total liabilities

(3,462)
(3,508)




Net assets

6,771
6,186




Equity



Share capital

352
361
Share premium

2,221
2,218
Own shares held in ESOP trust

(23)
(24)
Retained earnings

3,837
3,637
Other reserves

384
(6)
Total equity

6,771
6,186
The financial statements were approved by the Board of Directors on 21 March 2017 and signed on its behalf by:
Vronique Laury Karen Witts
Chief Executive Officer Chief Financial Officer
Consolidated cash flow statement

Year ended 31 January 2017



 millions
Notes
2016/17
2015/16
Operating activities 



Cash generated by operations
10
925
931
Income tax paid

(144)
(118)
Net cash flows from operating activities

781
813




Investing activities 



Purchase of property, plant and equipment and intangible assets 

(406)
(333)
Disposal of property, plant and equipment, investment property and property held for sale

20
25
Disposal of property company
12
-
18
Disposal of B&Q China:
12


Proceeds (net of costs and cash disposed)

63
102
Deposit repaid 

-
(12)
Decrease/(increase) in short-term deposits

70
(22)
Interest received

5
3
Dividends received from joint ventures and associates

-
5
Net cash flows from investing activities

(248)
(214)




Financing activities 



Interest paid

(10)
(12)
Interest element of finance lease rental payments

(2)
(3)
Repayment of bank loans

(2)
(1)
Repayment of fixed term debt

(47)
-
Receipt on financing derivatives

10
-
Capital element of finance lease rental payments 

(12)
(13)
New shares issued under share schemes 

3
4
Own shares issued under share schemes

1
1
Purchase of own shares for ESOP trust 

(6)
(16)
Purchase of own shares for cancellation

(200)
(200)
Ordinary dividends paid to equity shareholders of the Company

(230)
(232)
Net cash flows from financing activities

(495)
(472)




Net increase in cash and cash equivalents and bank overdrafts, including amounts classified as held for sale

38
127
Cash and cash equivalents and bank overdrafts, including amounts classified as held for sale, at beginning of year

654
527
Exchange differences 

103
-
Cash and cash equivalents and bank overdrafts at end of year
11
795
654
Notes
1 General information
Kingfisher plc ('the Company'), its subsidiaries, joint ventures and associates (together 'the Group') supply home improvement products and services through a network of retail stores and other channels, located mainly in the United Kingdom and continental Europe.
The Company is incorporated in the United Kingdom and is listed on the London Stock Exchange. The address of its registered office is 3 Sheldon Square, Paddington, London W2 6PX.
2 Basis of preparation
The consolidated financial statements of the Company, its subsidiaries, joint ventures and associates are made up to 31 January. The current financial year is the calendar year ended 31 January 2017 ('the year' or '2016/17'). The comparative financial year is the calendar year ended 31 January 2016 ('the prior year' or '2015/16').
The directors of Kingfisher plc, having made appropriate enquiries, consider that adequate resources exist for the Group to continue in operational existence and that, therefore, it is appropriate to adopt the going concern basis in preparing the consolidated financial statements for the year ended 31 January 2017.
The condensed financial information, which comprises the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated balance sheet, consolidated cash flow statement and related notes do not constitute statutory financial statements for the year ended 31 January 2017, but are derived from those statements. Statutory financial statements for 2015/16 have been filed with the Registrar of Companies and those for 2016/17 will be filed in due course. The Group's auditors have reported on both years' accounts; their reports were unqualified and did not contain statements under Section 498 (2) or (3) of the Companies Act 2006.
The condensed financial information has been abridged from the 2016/17 statutory financial statements, which have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union ('IFRS') and those parts of the Companies Act 2006 applicable to companies reporting under IFRS and therefore the consolidated financial statements comply with Article 4 of the EU IAS legislation. The consolidated income statement and related notes represent results for continuing operations, there being no discontinued operations in the years presented. The condensed financial information has been prepared under the historical cost convention, as modified by the use of valuations for certain financial instruments, share-based payments and post-employment benefits.
Accounting policies
The accounting policies adopted are consistent with those of the annual financial statements for the year ended 31 January 2016, as described in note 2 of those financial statements.
Principal rates of exchange against Sterling


2016/17

2015/16

Average rate
Year end rate
Average rate
Year end rate
Euro
1.21
1.16
1.38
1.31
US Dollar
1.34
1.26
1.52
1.42
Polish Zloty
5.28
5.03
5.78
5.78
Russian Rouble
87.98
75.72
94.54
107.52
Use of non-GAAP measures
In the reporting of financial information, the Group uses certain measures that are not required under IFRS, the generally accepted accounting principles ('GAAP') under which the Group reports. Kingfisher believes that adjusted sales, retail profit, underlying pre-tax profit, adjusted pre-tax profit, effective tax rate, underlying earnings per share and adjusted earnings per share provide additional useful information on performance and trends to shareholders. These and other non-GAAP measures, such as net cash, are used by Kingfisher for internal performance analysis and incentive compensation arrangements for employees. The terms 'retail profit', 'exceptional items', 'transformation costs', 'underlying', 'adjusted', 'effective tax rate' and 'net cash' are not defined terms under IFRS and may therefore not be comparable with similarly titled measures reported by other companies. They are not intended to be a substitute for, or superior to, GAAP measures.
Retail profit is defined as continuing operating profit before central costs, the Group's share of interest and tax of joint ventures and associates, transformation costs, exceptional items and amortisation of acquisition intangibles. It includes the sustainable benefits of the Group's transformation programme. 2015/16 comparatives exclude B&Q China's operating results. Central costs principally comprise the costs of the Group's head office before transformation costs.
The separate reporting of non-recurring exceptional items, which are presented as exceptional within their relevant income statement category, helps provide an indication of the Group's ongoing business performance. The principal items which are included as exceptional items are:
 non-trading items included in operating profit such as profits and losses on the disposal, closure or impairment of subsidiaries, joint ventures, associates and investments which do not form part of the Group's trading activities;
 profits and losses on the disposal of properties and impairment losses on non-operational assets; and
 the costs of significant restructuring, including certain restructuring costs of the Group's five-year transformation programme launched in 2016/17, and incremental acquisition integration costs.
The term 'adjusted' refers to the relevant measure being reported for continuing operations excluding exceptional items, financing fair value remeasurements, amortisation of acquisition intangibles, related tax items and prior year tax items (including the impact of changes in tax rates on deferred tax). 2015/16 comparatives exclude B&Q China's operating results. Financing fair value remeasurements represent changes in the fair value of financing derivatives, excluding interest accruals, offset by fair value adjustments to the carrying amount of borrowings and other hedged items under fair value hedge relationships. Financing derivatives are those that relate to hedged items of a financing nature.
The term 'underlying' refers to the relevant adjusted measure being reported before non-exceptional transformation costs. Non-exceptional transformation costs represent the short-term additional costs that arise only as a result of the transformation programme launched in 2016/17, which either because of their nature or the length of the period over which they are incurred are not considered as exceptional items. These costs principally relate to the unified and unique offer range implementation and the digital strategic initiative. The separate reporting of such costs (in addition to exceptional items) helps provide an indication of the Group's underlying business performance, which includes the sustainable benefits of the transformation programme. 
The effective tax rate is calculated as continuing income tax expense excluding tax on exceptional items and adjustments in respect of prior years and the impact of changes in tax rates on deferred tax, divided by continuing profit before taxation excluding exceptional items.
Net cash comprises cash and cash equivalents and short-term deposits less borrowings and financing derivatives (excluding accrued interest). It excludes balances classified as assets and liabilities held for sale.
3 Segmental analysis
Income statement 

2016/17
 millions
UK & Ireland
France
Other International
Total
Poland
Other
Adjusted sales
4,979
4,254
1,191
801
11,225
B&Q China sales




-
Sales




11,225
Retail profit 
358
353
144
(8)
847
Central costs




(48)
Share of interest and tax of joint ventures and associates




(5)
Transformation costs before exceptional items




(44)
Exceptional items




23
Operating profit




773
Net finance costs




(14)
Profit before taxation




759

2015/16 
 millions
UK & Ireland
France
Other International
Total
Poland
Other
Adjusted sales
4,853
3,786
987
705
10,331
B&Q China sales




110
Sales




10,441
Retail profit 
326
311
113
(4)
746
Central costs




(45)
Share of interest and tax of joint ventures and associates




(5)
B&Q China operating loss




(4)
Exceptional items




(166)
Operating profit




526
Net finance costs




(14)
Profit before taxation




512
The operating segments disclosed above are based on the information reported internally to the Board of Directors and Group Executive, representing the geographical areas in which the Group operates. The Group only has one business segment being the supply of home improvement products and services.
The 'Other International' segment consists of Poland, Spain, Portugal, Germany, Russia, Romania and the joint venture Kota in Turkey. Poland has been shown separately due to its significance.
Central costs principally comprise the costs of the Group's head office before transformation costs.
4 Exceptional items 
 millions
2016/17
2015/16
Included within selling and distribution expenses


UK & Ireland and continental Europe restructuring
21
(305)
Brico Dpt Romania impairment
-
(3)

21
(308)
Included within administrative expenses
Transformation exceptional costs
(5)
-
Brico Dpt Romania impairment
-
(15)

(5)
(15)
Included within other income
Profit on disposal of B&Q China
3
143
Profit on disposal of property and other companies
-
13
Profit on disposal of properties
4
1

7
157
Included within net finance costs


UK & Ireland and continental Europe restructuring
(6)
-

(6)
-
Exceptional items before tax
17
(166)
Exceptional tax items 
(6)
67
Exceptional items
11
(99)
Current year exceptional items include a 21m net credit (2015/16: 305m charge) relating to the B&Q store closure programme in the UK and the closure of loss-making stores in France and other countries in continental Europe. In addition, a 6m exceptional interest charge relating to the reduction in discount rate used to measure the overall UK restructuring provision was recognised.
The net credit principally arises due to savings on B&Q store exit costs as compared with the original restructuring provisions recognised, and the reversal of a restructuring provision following the announcement that one of the B&Q stores originally earmarked for closure would remain open, offset mainly by store asset impairments relating to the closure of additional loss-making stores in continental Europe.
Transformation exceptional costs of 5m have been recorded in the year relating to the initial costs of setting up the Group's new offer and supply chain organisation. 
A profit of 3m was recognised on disposal of the Group's remaining 30% stake in B&Q China - refer to note 12 for further information. In the prior year a profit of 143m was recorded on disposal of the Group's controlling 70% stake.
In the prior year, an exceptional loss of 18m was recorded relating to the impairment of goodwill and certain stores in the Brico Dpt Romania business.
5 Net finance costs
 millions
2016/17
2015/16
Bank overdrafts and bank loans
(10)
(8)
Fixed term debt
(2)
(3)
Finance leases
(2)
(3)
Financing fair value remeasurements
(1)
(4)
Unwinding of discount on provisions
(7)
(1)
Other interest payable
(5)
(3)
Finance costs 
(27)
(22)



Cash and cash equivalents and short-term deposits
6
3
Net interest income on defined benefit pension schemes
7
5
Finance income 
13
8



Net finance costs
(14)
(14)
The 7m charge relating to the unwinding of discount on provisions includes a 6m exceptional charge relating to the reduction in discount rate used to measure the overall UK restructuring provision.
6 Income tax expense
 millions
2016/17
2015/16
UK corporation tax


Current tax on profits for the year
(66)
(7)
Adjustments in respect of prior years
10
4

(56)
(3)
Overseas tax


Current tax on profits for the year
(155)
(117)
Adjustments in respect of prior years
(11)
7

(166)
(110)
Deferred tax


Current year
22
14
Adjustments in respect of prior years and changes in tax rates
51
(1)

73
13



Income tax expense
(149)
(100)
The effective tax rate on profit before exceptional items and excluding prior year tax adjustments and the impact of changes in tax rates on deferred tax is 26% (2015/16: 26%). Exceptional tax items for the year amount to a charge of 6m, of which a 1m credit relates to prior year items. In 2015/16 exceptional tax items amounted to a credit of 67m, of which a 1m credit was relating to prior year items.
7 Earnings per share


2016/17

2015/16

Earnings
Weighted
average
number
of shares 
Earnings per share
Earnings
Weighted
average
number
of shares 
Earnings per share

 millions
millions
Pence
 millions
millions
pence
Basic earnings per share
610
2,256
27.1
412
2,311
17.8
Effect of dilutive share options

7
(0.1)

8
-
Diluted earnings per share
610
2,263
27.0
412
2,319
17.8







Basic earnings per share
610
2,256
27.1
412
2,311
17.8
B&Q China operating loss
-

-
4

0.2
Exceptional items before tax
(17)

(0.8)
166

7.2
Tax on exceptional and prior year items
(43)

(2.0)
(76)

(3.3)
Financing fair value remeasurements
1

0.1
4

0.2
Tax on financing fair value remeasurements
-

-
(1)

(0.1)
Adjusted basic earnings per share
551
2,256
24.4
509
2,311
22.0
Transformation costs before exceptional items
44

2.0
-

-
Tax on transformation costs before exceptional items
(11)

(0.5)
-

-
Underlying basic earnings per share
584
2,256
25.9
509
2,311
22.0







Diluted earnings per share
610
2,263
27.0
412
2,319
17.8
B&Q China operating loss
-

-
4

0.2
Exceptional items before tax
(17)

(0.8)
166

7.2
Tax on exceptional and prior year items
(43)

(2.0)
(76)

(3.3)
Financing fair value remeasurements
1

0.1
4

0.2
Tax on financing fair value remeasurements
-

-
(1)

(0.1)
Adjusted diluted earnings per share
551
2,263
24.3
509
2,319
22.0
Transformation costs before exceptional items
44

2.0
-

-
Tax on transformation costs before exceptional items
(11)

(0.5)
-

-
Underlying diluted earnings per share
584
2,263
25.8
509
2,319
22.0
Basic earnings per share is calculated by dividing the profit for the year attributable to equity shareholders of the Company by the weighted average number of shares in issue during the year, excluding those held in the Employee Share Ownership Plan Trust ('ESOP') which for the purpose of this calculation are treated as cancelled.
For diluted earnings per share, the weighted average number of shares is adjusted to assume conversion of all dilutive potential ordinary shares. These represent share options granted to employees where both the exercise price is less than the average market price of the Company's shares during the year and any related performance conditions have been met.
8 Dividends 
 millions
2016/17
2015/16
Dividends to equity shareholders of the Company


Ordinary interim dividend for the year ended 31 January 2017 of 3.25p per share
(year ended 31 January 2016: 3.18p per share)
73
72
Ordinary final dividend for the year ended 31 January 2016 of 6.92p per share
(year ended 31 January 2015: 6.85p per share)
157
160

230
232
The proposed final dividend for the year ended 31 January 2017 of 7.15p per share is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in the financial statements.
9 Post-employment benefits

2016/17
2015/16
 millions
UK
Overseas
Total
UK
Overseas
Total
Net surplus/(deficit) in schemes
at beginning of year
246
(87)
159
194
(82)
112
Current service cost
(2)
(7)
(9)
(2)
(6)
(8)
Administration costs
(4)
-
(4)
(4)
-
(4)
Net interest income/(expense)
9
(2)
7
6
(1)
5
Net actuarial (losses)/gains
(46)
(4)
(50)
16
3
19
Contributions paid by employer
36
2
38
36
1
37
Exchange differences
-
(10)
(10)
-
(2)
(2)
Net surplus/(deficit) in schemes at end of year
239
(108)
131
246
(87)
159







Present value of defined benefit obligations
(2,999)
(126)
(3,125)
(2,374)
(102)
(2,476)
Fair value of scheme assets
3,238
18
3,256
2,620
15
2,635
Net surplus/(deficit) in schemes
239
(108)
131
246
(87)
159
The assumptions used in calculating the costs and obligations of the Group's defined benefit pension schemes are set by the Directors after consultation with independent professionally qualified actuaries. The assumptions are based on the conditions at the time and changes in these assumptions can lead to significant movements in the estimated obligations, as illustrated in the sensitivity analysis.
A key assumption in valuing the pension obligations is the discount rate. Accounting standards require this to be set based on market yields on high quality corporate bonds at the balance sheet date. The UK scheme discount rate is derived using a single equivalent discount rate approach, based on the yields available on a portfolio of high-quality Sterling corporate bonds with the same duration as that of the scheme liabilities.
The principal financial assumptions for the UK scheme are as follows:
Annual % rate
2016/17
2015/16
Discount rate
2.7
3.6
Price inflation
3.6
3.1
For the UK scheme, the mortality assumptions used have been selected with regard to the characteristics and experience of the membership of the scheme from time to time in connection with triennial funding valuations. The assumptions for life expectancy of UK scheme members are as follows:
Years

2016/17
2015/16
Age to which current pensioners are expected to live (60 now)



- Male

87.1
86.8
- Female 

88.8
87.4
Age to which future pensioners are expected to live (60 in 15 years' time)



- Male

88.3
87.5
- Female

90.7
88.6
The following sensitivity analysis for the UK scheme shows the estimated impact on the obligation resulting from changes to key actuarial assumptions, whilst holding all other assumptions constant.
Assumption
Change in assumption
Impact on defined benefit obligation
Discount rate
Increase/decrease by 0.1%
Decrease/increase by 57m
Price inflation
Increase/decrease by 0.1%
Increase/decrease by 46m
Mortality
Increase in life expectancy by one year
Increase by 96m
10 Cash generated by operations
 millions
2016/17
2015/16
Operating profit
773
526
Share of post-tax results of joint ventures and associates
(1)
(3)
Depreciation and amortisation 
253
240
Impairment losses
14
55
Loss on disposal of property, plant and equipment, investment property and
property held for sale
4
3
Profit on disposal of B&Q China
(3)
(143)
Profit on disposal of property and other companies
-
(13)
Share-based compensation charge
15
11
(Increase)/decrease in inventories
(46)
56
Decrease/(increase) in trade and other receivables
62
(36)
Increase in trade and other payables
4
27
Movement in provisions
(125)
233
Movement in post-employment benefits
(25)
(25)
Cash generated by operations
925
931
11 Net cash
 millions
2016/17
2015/16
Cash and cash equivalents
795
730
Bank overdrafts
-
(76)
Cash and cash equivalents and bank overdrafts
795
654
Short-term deposits
-
70
Bank loans
(9)
(10)
Fixed term debt
(147)
(185)
Financing derivatives
44
63
Finance leases
(42)
(46)
Net cash
641
546



 millions
2016/17
2015/16
Net cash at beginning of year
546
329
Net increase in cash and cash equivalents and bank overdrafts, including
amounts classified as held for sale
38
127
(Decrease)/increase in short term deposits
(70)
22
Repayment of bank loans
2
1
Repayment of fixed term debt 
47
-
Receipt on financing derivatives
(10)
-
Capital element of finance lease rental payments 
12
13
Cash flow movement in net cash
19
163
Adjustment for cash classified as held for sale (B&Q China)
-
57
Exchange differences and other non-cash movements
76
(3)
Net cash at end of year
641
546
12 Disposals
On 5 July 2016, the Group disposed of its remaining 30% interest in the B&Q China business to Wumei Holdings Inc. for a gross consideration of 67m, being the Sterling equivalent of RMB 582m. The profit on disposal of 3m is analysed as follows:
 millions


Proceeds

67
Disposal costs

(4)
Net disposal proceeds

63
Fair value of investment disposed

(67)
Fair value gains transferred from available-for-sale reserve

7
Exceptional profit on disposal

3
In the prior year, the Group received gross proceeds of 140m (before disposal costs of 6m) and recognised a profit on disposal of 143m in respect of Wumei Holdings Inc. acquiring a controlling 70% stake in the B&Q China business. In the prior year, the Group also completed the sale of a property company for proceeds of 18m and a profit of 16m, along with the sale of a UK company for proceeds of nil and a loss of 3m.

This information is provided by RNS
The company news service from the London Stock Exchange
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