Interim Results - Part 2
British Land Co PLC
27 November 2002
Independent review report to The British Land Company PLC
Introduction
We have been instructed by the Company to review the financial information for
the six months ended 30 September 2002 which comprises the Consolidated Profit
and Loss Account, Consolidated Balance Sheet, Consolidated Cash Flow Statement,
Consolidated Statement of Total Recognised Gains and Losses, the note of
historical cost profits and losses, the reconciliation of movements in
shareholders' funds and related notes 1 to 18. We have read the other
information contained in the interim report and considered whether it contains
any apparent misstatements or material inconsistencies with the financial
information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with United Kingdom Auditing Standards and therefore
provides a lower level of assurance than an audit. Accordingly, we do not
express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2002.
Deloitte & Touche 26 November 2002
Chartered Accountants
London
Consolidated Profit & Loss Account for the six months ended 30 September 2002
Year
ended
31
March
2002 Note 2002 2001
Audited Unaudited Unaudited
£m £m £m
513.8 Gross rental 266.2 247.6
income
(98.5) Less share 8 (53.3) (46.9)
of joint
ventures
415.3 Gross rental 212.9 200.7
income -
Group
386.6 Net rental 200.1 187.5
income
6.8 Profit on 6.3
property
trading
9.5 Other income 2.0 7.3
(39.3) Administrative (20.6) (17.5)
expenses
363.6 Operating 181.5 183.6
profit
88.6 Share of 8 45.5 42.8
operating
profits of
joint
ventures
37.0 Disposal of fixed 2 3.1 11.0
assets - including
amounts from joint
ventures (note 8)
489.2 Profit on ordinary 230.1 237.4
activities before
interest
(317.9) Net interest 3 (164.8) (157.4)
payable
171.3 Profit on ordinary 65.3 80.0
activities before
taxation
(11.9) Taxation 4 (12.8) (16.7)
159.4 Profit on ordinary 52.5 63.3
activities after
taxation
(64.3) Ordinary 5 (21.3) (19.7)
dividends
95.1 Retained 31.2 43.6
profit for
the period
30.8p Earnings per Basic 6 10.1p 12.2p
share:
30.2p Diluted 6 10.3p 12.4p
32.1p Adjusted Basic 6 10.3p 12.5p
earnings per
share:*
31.5p Diluted 6 10.5p 12.6p
12.4p Dividend per 5 4.1p 3.8p
share
The results stated
above relate to the
continuing
activities of the
Group.
* Adjusted to exclude
the capital
allowance effects of
FRS 19.
Consolidated Balance Sheet as at 30 September 2002
31
March
2002 Note 2002 2001
Audited Unaudited Unaudited
£m £m £m
Fixed assets
7,528.3 Investment 7 7,659.9 7,403.1
properties
Investments
in joint
ventures:
1,689.6 Share of 8 1,617.6 1,737.5
gross assets
(962.4) Share of 8 (899.3) (915.7)
gross
liabilities
727.2 718.3 821.8
12.4 Other 11.8 73.2
investments
8,267.9 8,390.0 8,298.1
Current
assets
47.0 Trading 7 46.7 53.3
properties
45.6 Debtors 9 58.6 92.8
366.9 Cash and 133.9 142.7
deposits
459.5 Total 239.2 288.8
current
assets
Creditors
due within
one year
(323.0) Convertible 13
Bonds
(446.5) Other
creditors 10 (602.1) (669.2)
(769.5) (602.1) (669.2)
(310.0) Net current (362.9) (380.4)
liabilities
7,957.9 Total 8,027.1 7,917.7
assets less
current
liabilities
(3,613.7) Creditors 11 (3,631.5) (3,377.6)
due after
one year
(146.7) Convertible 13 (146.8) (464.4)
Bonds
(89.6) Provisions 12 (91.2) (83.1)
for
liabilities
and charges
4,107.9 4,157.6 3,992.6
Capital and
reserves
129.6 Called up 129.5 129.6
share
capital
1,106.2 Share 17 1,107.7 1,105.9
premium
0.3 Capital 17 0.4 0.3
redemption
reserve
(5.7) Other 17 (7.5) (1.8)
reserves
2,165.0 Revaluation 17 2,183.1 2,079.4
reserve
712.5 Profit and 17 744.4 679.2
loss account
4,107.9 Shareholders' 4,157.6 3,992.6
funds
833p Adjusted Basic 16 842p 813p
NAV per
share -
803p Fully 16 822p 785p
diluted
(The Net Asset Value (NAV) per share includes the external valuation surplus
on development and trading properties but excludes the capital allowance
effects of FRS19.)
Approved by the Board on 26 November 2002
Other Consolidated Primary Statements for the six months ended 30 September
2002
Year
ended
31
March
2002 2002 2001
Audited Unaudited Unaudited
£m £m £m
Statement of total
recognised gains and
losses
159.4 Profit on 52.5 63.3
ordinary
activities
after
taxation
Unrealised
surplus
(deficit)
on
revaluation:
58.9 - investment (9.7) 34.2
properties
48.8 - joint 29.2 13.6
ventures
(0.1) - other (0.1) (4.0)
investments
107.6 19.4 43.8
(0.5) Exchange 0.2 0.1
movements
on net
investments
(9.7) Taxation on realisation (10.0)
of prior year revaluations
Total recognised gains
and losses relating to
the financial
256.8 period 72.1 97.2
Year ended
31 March
2002 2002 2001
Audited Unaudited Unaudited
£m £m £m
Note of historical
cost profits and losses
171.3 Profit on ordinary 65.3 80.0
activities before
taxation
33.6 Realisation of prior 2.0 56.2
year revaluations
(9.7) Taxation on (10.0)
realisation of prior
year revaluations
195.2 Historical cost profit 67.3 126.2
on ordinary activities
before taxation
119.0 Historical cost profit 33.2 89.8
for the period
retained after
taxation and dividends
Other Consolidated Primary Statements for the six months ended 30 September
2002
Year ended
31 March
2002 2002 2001
Audited Unaudited Unaudited
£m £m £m
Reconciliation of
movements in
shareholders' funds
159.4 Profit on ordinary 52.5 63.3
activities after
taxation
(64.3) Ordinary dividends (21.3) (19.7)
95.1 Retained profit 31.2 43.6
for the period
Revaluation of
investment
properties
107.6 and investments 19.4 43.8
(0.5) Exchange movements 0.2 0.1
on net investments
(9.7) Taxation on (10.0)
realisation of
prior year
revaluations
192.5 50.8 77.5
0.9 Shares issued 1.5 0.6
Purchase and (2.6)
cancellation of
own shares
193.4 Increase in 49.7 78.1
shareholders' funds
3,914.5 Opening 4,107.9 3,914.5
shareholders' funds
4,107.9 Closing 4,157.6 3,992.6
shareholders' funds
Consolidated Cash Flow Statement for the six months ended 30 September 2002
Year
ended
31
March
2002 Note 2002 2001
Audited Unaudited Unaudited
£m £m £m
382.4 Net cash inflow from 15 178.4 230.4
operating activities
25.2 Dividends received 5.6
from joint ventures
Returns on investments
and servicing of
finance
59.9 Interest received 9.3 2.8
(366.1) Interest paid (164.0) (204.2)
5.1 Dividends received 4.8
(301.1) (154.7) (196.6)
(7.7) Taxation paid (9.0) (2.8)
Net cash inflow from
operating activities
and investments
after finance charges
98.8 and taxation 20.3 31.0
Capital expenditure
and financial
investment
Development
expenditure and
purchase of investment
(426.1) properties (118.3) (297.4)
(8.5) Purchase of investments (0.2) (4.4)
148.9 Sale of investment 20.5 128.7
properties
158.4 Sale of investments
(127.3) (98.0) (173.1)
Acquisitions and
disposals
Purchase of remaining
50% interest
in subsidiary company 14 (12.0)
Cash at bank acquired
with 50% interest in
subsidiary 14 0.3
company
(176.0) Investment in and (8.5) (159.1)
loans to joint ventures
150.5 Sale of shares in and 52.6 26.2
loans repaid by joint
ventures
(25.5) 32.4 (132.9)
(60.6) Equity dividends paid (44.6) (40.9)
Net cash outflow
before management
(114.6) of liquid resources and financing (89.9) (315.9)
Management of liquid
resources
(281.5) Decrease (increase) in 242.0 (15.8)
term deposits
Financing
0.9 Issue of ordinary 1.2 0.6
shares
Purchase and (1.5)
cancellation of own
shares
Repurchase of 6.5% (322.7)
Convertible Bonds 2007
(300.0) Repurchase of bonds (300.0)
575.0 Issue of Sainsbury 575.0
supermarkets
securitised debt
825.0 Issue of Meadowhall
Shopping Centre
securitised debt
(711.9) Increase (decrease) in 186.5 92.2
bank and other borrowings
389.0 (136.5) 367.8
(7.1) Increase (decrease) in 15 15.6 36.1
cash
Notes to the accounts for the six months ended 30 September 2002 (unaudited)
1. Basis of preparation
The interim accounts are not statutory accounts, but are prepared on the
basis of the accounting policies set out in the Group's financial
statements for the year ended 31 March 2002, consistently applied in all
material respects.
The figures for the year ended 31 March 2002 have been extracted from the
statutory accounts which have been filed with the Registrar of Companies.
The auditors' report on those accounts was unqualified and did not contain
any statement under section 237 (2) or (3) of the Companies Act 1985.
2. Disposal of fixed assets
Year ended
31 March
2002 2002 2001
£m £m £m
39.5 British Land Group 0.9 12.3
(2.5) Share of joint ventures (note 8) 2.2 (1.3)
37.0 3.1 11.0
The profit for the year ended 31 March 2002 included £25.6 million arising on
the disposal of shares held in Haslemere N.V.
3. Net interest payable
Year ended
31 March
2002 2002 2001
£m £m £m
British Land Group
41.4 Payable on: bank loans and 12.4 28.7
overdrafts
240.8 other loans 134.5 108.5
282.2 146.9 137.2
(5.9) Deduct: development cost (2.5) (2.0)
element
276.3 144.4 135.2
(8.4) Receivable on: deposits and (9.0) (3.1)
securities
(16.1) loans to joint (5.1) (7.9)
ventures
251.8 Total British Land Group 130.3 124.2
Share of joint ventures
16.1 Interest payable on shareholder loans 5.1 7.9
50.0 Other interest payable (net) 29.4 25.3
66.1 Total share of joint ventures (note 8) 34.5 33.2
317.9 Net interest payable 164.8 157.4
On 16 May 2002 the Company gave notice to redeem the 6.5% Convertible Bonds
2007. The Bonds were redeemed and cancelled on 24 June 2002.
4. Taxation
Year ended
31 March
2002 2002 2001
£m £m £m
(6.1) British Land Group: Corporation tax 6.8 4.5
11.7 Deferred tax 1.7 9.3
5.4 Share of joint ventures (note 8): Corporation tax 4.8 4.4
0.9 Deferred tax (0.5) (1.5)
11.9 12.8 16.7
Contingent tax
Unprovided further taxation which might become payable if the Group's
investments and properties were sold at open market value is estimated at
£505m (31 March 2002 - £510m; 30 September 2001 - £520m). Tax losses, which
have not been recognised in the Balance Sheet, have reduced the contingent
tax by approximately £100m. This unprovided taxation is stated after taking
account of the FRS19 capital allowance deferred tax provision of £84m (31
March 2002 - £83m; 30 September 2001 - £80m).
5. Interim dividend
The interim dividend of 4.1 pence will be paid on 21 February 2003 to
shareholders on the register at the close of business on 24 January 2003.
6. Basic and diluted earnings per share
Basic and diluted earnings per share are calculated on the profit on ordinary
activities after taxation and on the weighted average number of shares in
issue during the period as shown below:
Year ended
31 March 2002 2002 2001
Weighted Weighted Weighted
average Profit average Profit average Profit
number after number after number after
of taxation of taxation of taxation
shares shares shares
m £m m £m m £m
Earnings per
share
518.3 159.4 Basic 518.7 52.5 518.3 63.3
596.4 180.4 Diluted 571.0 59.1 596.4 73.8
Weighted Weighted Weighted
average Profit average Profit average Profit
number after number after number after
of taxation of taxation of taxation
shares shares shares
m £m m £m m £m
Adjusted
earnings per
share
518.3 166.6 Basic 518.7 53.3 518.3 64.9
596.4 187.6 Diluted 571.0 59.9 596.4 75.4
Adjusted earnings per share are calculated by excluding £0.8m (31 March 2002
- £7.2m; 30 September 2001 - £1.6m) which is the capital allowance effects of
FRS 19.
The diluted weighted average number of shares has changed as a result of the
redemption in June 2002 of the 6.5% Convertible Bonds 2007.
7. Investment, development and trading properties
Leasehold
Freehold Long Short Total
£m £m £m £m
Investment and development
properties
Valuation and cost 1 April 2002 7,239.5 288.8 7,528.3
Additions 143.1 16.5 159.6
Disposals (20.0) (20.0)
Exchange 1.7 1.7
fluctuations
Revaluations (22.8) 13.1 (9.7)
Valuation and cost 30 September 7,341.5 318.4 7,659.9
2002
Trading properties
At lower of cost and net
realisable value
30 September 2002 37.2 8.0 1.5 46.7
External valuation surplus on development 93.6
and trading properties
Total investment, development and trading 7,800.2
properties
Investment, development and trading properties were valued by external
valuers on the basis of open market value in accordance with the Appraisal
and Valuation Manual published by The Royal Institution of Chartered
Surveyors.
£m
On an open market basis - External valuations:
United Kingdom: ATIS REAL 7,743.7
Weatheralls
Republic of Ireland: Jones Lang LaSalle 66.3
Netherlands: CB Richard Ellis 1.0
B.V.
7,811.0
Adjustment for UITF 28 - lease incentive debtors (10.8)
Total investment, development and trading properties 7,800.2
Total external valuation surplus on development and trading
properties
£m
British Land Group 93.6
Share of joint ventures 11.2
104.8
7. Investment, development and trading properties (continued)
Total property valuations including share of joint ventures
31 March
2002 2002 2001
£m £m £m
British Land Group
7,528.3 Investment and development 7,659.9 7,403.1
properties
47.0 Trading properties 46.7 53.3
External valuation surplus on
development and
108.6 trading properties 93.6 127.7
7.7 Adjustment for UITF 28 - lease 10.8 5.3
incentive debtors
7,691.6 7,811.0 7,589.4
Share of joint ventures
1,601.3 Properties 1,550.2 1,648.4
External valuation surplus on
development and
5.5 trading properties 11.2 2.7
1.9 Adjustment for UITF 28 - lease 3.2 0.4
incentive debtors
1,608.7 1,564.6 1,651.5
9,300.3 9,375.6 9,240.9
8. Joint ventures
British Land's share of profits of joint ventures
Year ended
31 March
2002 2002 2001
£m £m £m
98.5 Gross rental income 53.3 46.9
90.3 Net rental income 49.1 43.4
(1.7) Other expenditure (3.6) (0.6)
88.6 Operating profit 45.5 42.8
(2.5) Disposal of fixed assets 2.2 (1.3)
86.1 Profit on ordinary activities before interest 47.7 41.5
(50.0) Net interest payable to third parties (29.4) (25.3)
(16.1) Interest payable to British Land (5.1) (7.9)
(66.1) Net interest payable (note 3) (34.5) (33.2)
20.0 Profit on ordinary activities before taxation 13.2 8.3
(6.3) Taxation (4.3) (2.9)
13.7 Profit on ordinary activities after taxation 8.9 5.4
The amounts relating to captions shown in bold are recognised at the relevant
point in the consolidated profit and loss account.
The movement for the period:
Equity Loans Total
£m £m £m
At 1 April 2002 433.3 293.9 727.2
Additions 3.8 10.9 14.7
Repayment of loans (55.1) (55.1)
Share of profit attributable to joint ventures 3.3 3.3
(net of dividend)
Disposals (1.0) (1.0)
Revaluations 29.2 29.2
At 30 September 2002 468.6 249.7 718.3
8. Joint ventures (continued)
Summary of British Land's share in joint ventures
Operating Gross Gross Net
profits assets liabilities investment
£m £m £m £m
The Public House Company 2.6 88.8 (49.6) 39.2
Ltd
BL Universal PLC 12.4 396.1 (193.3) 202.8
BL Fraser Ltd 3.5 112.6 (74.4) 38.2
BLT Properties Ltd 4.0 126.4 (69.2) 57.2
Tesco BL Holdings Ltd 5.6 179.4 (111.3) 68.1
BL West 5.7 184.0 (138.9) 45.1
London & Henley Holdings 1.5 90.0 (51.4) 38.6
Ltd
BL Davidson Ltd 7.0 249.0 (167.1) 81.9
BL Rank Properties Ltd 2.7 (1.2) (1.2)
Cherrywood Properties Ltd (1.7) 43.0 (3.1) 39.9
(Republic of Ireland)
Other joint ventures 2.2 148.3 (39.8) 108.5
Total 45.5 1,617.6 (899.3) 718.3
The Group's share of joint venture external net debt is £740.9m (31 March
2002 - £791.6 m). The amount guaranteed by British Land is £28.0m (31 March
2002 - £33.0m).
The Group's share of the market value of the debt and derivatives as at 30
September 2002 was £46.5m more than the Group's share of the book value (31
March 2002 - £16.8m).
The Group's share of joint venture properties as at 30 September 2002 was
£1,550.2m (31 March 2002 - £1,601.3m).
9. Debtors
31 March
2002 2002 2001
£m £m £m
25.5 Trade debtors 35.3 52.8
8.6 Amounts owed by joint ventures 6.7 27.6
11.5 Prepayments and accrued income 16.6 12.4
45.6 58.6 92.8
10. Creditors due within one year
31 March
2002 2002 2001
£m £m £m
45.4 Debentures and loans (note 13) 52.6 42.1
4.3 Overdrafts (note 13) 2.6
74.2 Bank loans (note 13) 270.1 292.5
45.7 Trade creditors 50.7 65.9
33.4 Corporation tax 28.4 49.2
12.0 Other taxation and social security 12.7 12.8
186.9 Accruals and deferred income 166.3 184.4
44.6 Proposed dividend 21.3 19.7
446.5 602.1 669.2
11. Creditors due after one year
31 March
2002 2002 2001
£m £m £m
3,451.8 Debentures and loans (note 13) 3,425.5 2,661.3
161.9 Bank loans (note 13) 206.0 716.3
3,613.7 3,631.5 3,377.6
12. Provisions for liabilities and charges
31 March
2002 2002 2001
£m £m £m
89.6 Deferred tax 91.2 83.1
The deferred tax liability relates primarily to capital allowances claimed on
plant and machinery within investment properties. When a property is sold and
the agreed disposal value for this plant and machinery is less than original
cost, there is a release of the surplus part of the provision. The entire
amount of the capital allowance provision would be expected to be released on
sale.
13. Net debt
31 March
2002 2002 2001
£m £m £m
Secured on the assets of the Group
97.7 + 6.5055% Secured Notes 2038 97.7 97.7
59.2 + 5.920% Secured Notes 2035 59.2
246.6 8.875% First Mortgage Debenture Bonds 2035 246.6 246.6
197.2 9.375% First Mortgage Debenture Stock 2028 197.2 197.1
19.6 + 7.743% Secured Notes 2025 19.6 19.6
12.6 10.5% First Mortgage Debenture Stock 2019/24 12.6 12.6
20.4 11.375% First Mortgage Debenture Stock 2019/24 20.4 20.4
1.9 + 5.66% 135 Bishopsgate Securitisation 2018 1.9 1.9
7.1 + 8.49% 135 Bishopsgate Securitisation 2018 7.1 7.1
662.3 662.3 603.0
Unsecured
542.8 + Class A1 5.260% Unsecured Notes 2035 542.8
88.9 + Class B 5.793% Unsecured Notes 2035 88.8
74.0 + Class C Fixed Rate Unsecured Notes 2035 74.0
73.3 + Class C2 6.4515% Unsecured Notes 2032 73.3 73.2
219.8 + Class B 6.0875% Unsecured Notes 2031 219.9 219.7
146.5 + Class A3 5.7125% Unsecured Notes 2031 146.6 146.5
291.9 + Class A2 5.67% Unsecured Notes 2029 289.9 293.8
157.0 + Class A2 (C) 6.457% Unsecured Notes 2025 156.9 156.8
205.5 + Class B2 6.998% Unsecured Notes 2025 205.5 205.5
20.6 + Class B3 7.243% Unsecured Notes 2025 20.5 20.5
317.5 + Class A1 Fixed Rate Unsecured Notes 2024 318.4 317.4
24.3 + 5.66% 135 Bishopsgate Securitisation 2018 23.8 24.9
94.5 + 8.49% 135 Bishopsgate Securitisation 2018 93.1 96.5
63.3 + Class A1 6.389% Unsecured Notes 2016 62.1 64.1
97.0 + Class B1 7.017% Unsecured Notes 2016 94.3 98.3
171.0 + Class C1 6.7446% Unsecured Notes 2014 168.6 170.9
98.2 + Class D Fixed / Floating Rate Unsecured
Notes 2014 88.4 112.8
49.3 + Class A2 5.555% Unsecured Notes 2013 49.4
1.7 10.25% Bonds 2012 1.7 1.7
97.8 * 7.35% Senior US Dollar Notes 2007 97.8 97.8
240.4 Bank loans and overdrafts 476.1 1,011.4
3,075.3 3,291.9 3,111.8
Convertible Bonds
146.7 6% Subordinated Irredeemable 146.8 146.7
Convertible Bonds
323.0 ** 6.5% Convertible Bonds 2007 317.7
469.7 146.8 464.4
4,207.3 Gross debt 4,101.0 4,179.2
(366.9) Cash and deposits (133.9) (142.7)
3,840.4 Net debt 3,967.1 4,036.5
+ These borrowings are obligations of ringfenced, default remote, special
purpose companies, with no recourse to other companies or assets in the Group.
* These borrowings have been hedged into Sterling since the date of issue.
** These bonds were redeemed and cancelled on 24 June 2002.
13. Net debt (continued)
Maturity analysis of net debt
31 March
2002 2002 2001
£m £m £m
Repayable:
446.9 within one year and on demand 322.7 337.2
151.1 between: one and two years 150.1 506.0
324.9 two and five years 359.5 395.2
365.0 five and ten years 392.6 710.4
418.3 ten and fifteen 427.1 317.7
years
459.9 fifteen and twenty 462.7 324.5
years
630.7 twenty and twenty 607.5 481.3
five years
845.8 twenty five and 855.9 569.9
thirty years
418.0 thirty and thirty 376.1 390.3
five years
146.7 Irredeemable 146.8 146.7
4,207.3 Gross debt 4,101.0 4,179.2
(366.9) Cash and deposits (133.9) (142.7)
3,840.4 Net debt 3,967.1 4,036.5
Maturity of committed undrawn borrowing facilities
31 March
2002 2002 2001
£m £m £m
Expiring:
437.1 within one year 341.8 206.8
161.8 between: one and two years 54.0 105.0
402.5 two and three years 380.0 29.0
425.0 three and four years 330.0 345.0
215.0 four and five years 210.0 315.0
37.7 over five years 32.4 40.5
1,679.1 Total 1,348.2 1,041.3
Interest rate profile - including effect of derivatives
31 March
2002 2002 2001
£m £m £m
3,541.2 Fixed rate 3,494.5 3,444.2
100.0 Capped rate 100.0 200.0
199.2 Variable rate (net of cash) 372.6 392.3
3,840.4 Net debt 3,967.1 4,036.5
13. Net debt (continued)
Comparison of market values and book values at 30 September 2002
Market Book
Value Value Difference
£m £m £m
Fixed rate debt:
Securitisations 3,182.7 2,901.8 280.9
Debentures and unsecured bonds 778.0 576.3 201.7
Convertible bonds 159.8 146.8 13.0
Bank debt 476.1 476.1
Cash and deposits (133.9) (133.9)
4,462.7 3,967.1 495.6
Derivatives
- unrecognised gains (17.4) (17.4)
- unrecognised losses 33.4 33.4
16.0 16.0
Total 4,478.7 3,967.1 511.6
The market value and difference are shown before any tax relief.
14. Acquisition of Broadgate Phase 12 Limited
On 19 July 2002 the Group acquired the remaining 50% interest in Broadgate
Phase 12 Limited, owner of 201 Bishopsgate, London EC2. The net assets
acquired and the fair value to the Group are as follows:
Total Book value Fair value adjustment Fair
book value acquired value to
Group
£m £m £m £m
201 55.2 27.6 12.9 40.5
Bishopsgate,
London EC2
Cash 0.6 0.3 0.3
Creditors (1.0) (0.5) (0.5)
Loans (54.6) (27.3) (27.3)
0.2 0.1 12.9 13.0
Retention (1.0)
Cash paid 12.0
Purchase of 13.0
shares
Repayment of 27.3
loans
Total cash 40.3
payable
The fair value adjustment arises because, as a development property, 201
Bishopsgate was carried in the accounts of Broadgate Phase 12 Limited at
historical cost.
15. Notes to the cash flow statement
Reconciliation of operating profit to net cash inflow from operating
activities
Year ended
31 March
2002 2002 2001
£m £m £m
363.6 Operating profit 181.5 183.6
(5.1) Dividends received (4.8)
1.3 Depreciation 0.7 0.9
6.3 Decrease in trading properties 0.3
4.9 (Increase) decrease in debtors (15.3) 37.4
11.4 Increase in creditors 11.2 13.3
382.4 Net cash inflow from operating activities 178.4 230.4
Analysis of Group net debt
1 30 30
April Cash Non cash September September
2002 Acquisitions flow movements 2002 2001
£m £m £m £m £m £m
Cash at (20.4) (11.3) (31.7) (61.9)
bank
Overdraft 4.3 (4.3) 2.6
Net cash
per
cash flow (16.1) (15.6) (31.7) (59.3)
statement
Term debt 3,733.3 27.3 186.5 7.1 3,954.2 3,712.2
Convertible 469.7 (322.7) (0.2) 146.8 464.4
Bonds
Term (346.5) 242.0 2.3 (102.2) (80.8)
deposits
Group net 3,840.4 27.3 90.2 9.2 3,967.1 4,036.5
debt
Reconciliation of net cash flow to movement in Group net debt
Year ended
31 March
2002 2002 2001
£m £m £m
3,716.8 Brought forward 3,840.4 3,716.8
Movement in net debt in the period:
7.1 (Increase) decrease in cash (15.6) (36.1)
388.1 Cash inflow from movement in debt 186.5 367.2
Cash outflow to repurchase Convertible
Bonds (322.7)
(281.5) Cash outflow (inflow) in term deposits 242.0 (15.8)
113.7 Changes resulting from cash flows 90.2 315.3
9.9 Other non cash movements 36.5 4.4
123.6 126.7 319.7
3,840.4 Carried forward 3,967.1 4,036.5
16. Net Asset Value per share
Adjusted
Net Net
Shares Assets Assets
m £m £m
Net Asset Value (undiluted)
Shareholders' funds as shown on 518.3 4,157.6 4,157.6
balance sheet
FRS19 capital allowance effects
British Land 87.9
Group
Share of joint 11.7
ventures
99.6
Total external valuation surplus on
development and trading properties (note 7) 104.8 104.8
Net assets attributable to ordinary 4,362.0 4,262.4
shares
At 30 September 2002 842p 822p
At 30 September 2001 813p 795p
At 31 March 2002 833p 814p
Fully diluted Net Asset Value
Net assets attributable to ordinary 518.3 4,362.0 4,262.4
shares
Adjust to fully diluted on conversion
of:
6% Irredeemable 30.0 146.8 146.8
Convertible Bonds
Net assets attributable to fully 548.3 4,508.8 4,409.2
diluted ordinary shares
At 30 September 2002 822p 804p
At 30 September 2001 785p 769p
At 31 March 2002 803p 787p
The adjusted NAV includes the surplus before tax of the external valuation
over the book value of both development and trading properties and after
adding back the FRS19 deferred tax capital allowance provision (as described
in note 12) which is not expected to arise.
17. Reserves Profit
Capital and
Share redemption Other Revaluation loss
premium reserve reserves reserve account Total
£m £m £m £m £m £m
At 1 April 2002 1,106.2 0.3 (5.7) 2,165.0 712.5 3,978.3
Issues 1.5 1.5
Purchase and
cancellation
of own shares 0.1 (2.6) (2.5)
Retained profit for
the period 31.2 31.2
Realisation of prior
year revaluations (2.0) 2.0
Current period 19.4 19.4
revaluation
Exchange movements on
net investments (1.8) 0.7 1.3 0.2
At 30 September 2002 1,107.7 0.4 (7.5) 2,183.1 744.4 4,028.1
18. Contingent liabilities
Contingent liabilities of the Parent for guarantees to third parties amounted
to £28.0m (31 March 2002 - £33.0m; 30 September 2001 - £33.0m).
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