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Brambles Industries (BI.)

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Wednesday 24 August, 2005

Brambles Industries

Final Results - Part 4

Brambles Industries PLC
23 August 2005


Brambles

COMBINED PROFIT AND LOSS ACCOUNT
for the year ended 30 June 2005

                                                   2005                                     2004
                                 --------------------------------------------------------------------------------------
                                      Before                                         Before
                                    goodwill         Goodwill                       goodwill       Goodwill
                                amortisation     amortisation                   amortisation   amortisation
                               & exceptional    & exceptional                  & exceptional  & exceptional
                                       items            items         Total            items          items       Total
                                  £ millions       £ millions    £ millions       £ millions     £ millions  £ millions
                                   ------------------------------------------------------------------------------------
TURNOVER
(including share of
joint ventures and associates)
- Continuing operations                3,307              -         3,307           3,109              -          3,109
- Discontinued operations                  -              -             -               3              -              3
                                    -----------------------------------------------------------------------------------
                                        3,307             -         3,307           3,112              -          3,112
Less share of
turnover of:
- Joint ventures - continuing operations (55)             -          (55)            (51)              -            (51)
- Associates - continuing operations     (41)             -          (41)            (38)              -            (38)
                                    -----------------------------------------------------------------------------------
GROUP TURNOVER                          3,211             -         3,211           3,023              -          3,023
              
OPERATING PROFIT
Continuing operations before goodwill
amortisation and exceptional items        438             -          438              366              -            366
Goodwill amortisation                       -           (34)         (34)               -            (34)           (34)
Exceptional items                           -             -            -                -            (75)           (75)
                                    -----------------------------------------------------------------------------------
Continuing operations                     438           (34)         404              366           (109)           257
Discontinued operations                     -             -            -                1              -              1
                                    -----------------------------------------------------------------------------------
GROUP OPERATING PROFIT                    438           (34)         404              367           (109)           258

Share of operating profit of:
- Joint ventures - continuing operations   10             -           10               10              -             10
- Associates - continuing operations        4            (1)           3                4             (1)             3
                      
                                    -----------------------------------------------------------------------------------
TOTAL OPERATING PROFIT                   452            (35)         417              381           (110)           271

NON-OPERATING 
EXCEPTIONAL ITEMS
Net profit on sale of investments 
- continuing                               -              4            4                -              -              -

Net profit on sale of discontinued 
operations                                 -              -            -                -             27             27
                                    -----------------------------------------------------------------------------------

                                           -              4            4                -             27             27
                                    -----------------------------------------------------------------------------------
PROFIT BEFORE INTEREST AND TAX           452            (31)         421              381            (83)           298
Net interest payable:
- Group                                  (72)             -          (72)             (72)             -            (72)
- Share of joint ventures and associates  (2)             -           (2)              (2)             -             (2)
                                    -----------------------------------------------------------------------------------
                                         (74)             -          (74)             (74)             -            (74)
                                    -----------------------------------------------------------------------------------
PROFIT ON ORDINARY ACTIVITIES 
BEFORE TAX                               378            (31)         347              307            (83)           224
Tax on profit on ordinary activities    (123)            (4)        (127)             (97)            (2)           (99)
                                    -----------------------------------------------------------------------------------

PROFIT ON ORDINARY ACTIVITIES
AFTER TAX                                255            (35)         220              210            (85)           125
Equity minority interests                 (1)             -           (1)               -              1              1
                                    -----------------------------------------------------------------------------------

PROFIT ATTRIBUTABLE TO PARENT
COMPANIES' SHAREHOLDERS                  254            (35)         219              210            (84)           126

Equity dividends paid and proposed      (152)             -         (152)            (136)             -           (136)
                                    -----------------------------------------------------------------------------------

TRANSFER TO/(FROM)RESERVES               102            (35)          67               74            (84)           (10)
                                    -----------------------------------------------------------------------------------
Basic earnings per share (pence)        15.0                        12.9             12.4                           7.5
Diluted earnings per share (pence)      14.9                        12.8             12.4                           7.4
                                    -----------------------------------------------------------------------------------

                                        16
Brambles

COMBINED BALANCE SHEET
as at 30 June 2005

                                                             2005         2004
                                                        £millions    £millions
                                                        -----------------------

FIXED ASSETS
Intangible assets                                             442         451
Tangible assets                                             2,264       2,220
                                                           --------   ---------
                                                            2,706       2,671
Investments
- Joint ventures:
- Share of gross assets                                        88          84
- Share of gross liabilities                                  (47)        (43)
                                                           --------   ---------
                                                               41          41
- Associates                                                   28          28
- Other investments                                             2           9
                                                           --------   ---------
Total investments                                              71          78
                                                           --------   ---------
Total fixed assets                                          2,777       2,749
                                                           --------   ---------

CURRENT ASSETS
Stock                                                          39          33
Debtors                                                       678         633
Cash at bank and in hand                                      105          34
                                                           --------   ---------
                                                              822         700
                                                           --------   ---------
CREDITORS: amounts falling due within one year
Borrowings                                                    (15)        (39)
Creditors                                                    (576)       (518)
Tax and dividend payable                                     (135)       (100)
                                                           --------   ---------
                                                             (726)       (657)
                                                           --------   ---------
NET CURRENT ASSETS                                             96          43
                                                           --------   ---------
TOTAL ASSETS LESS CURRENT LIABILITIES                       2,873       2,792

CREDITORS: amounts falling due after more than one year
Borrowings                                                 (1,320)     (1,390)
Provisions for liabilities and charges                       (307)       (285)
                                                           --------   ---------
NET ASSETS                                                  1,246       1,117
                                                           --------   ---------
CAPITAL AND RESERVES
Share capital                                                 550         499
Share premium account                                          51          50
Other reserves                                                 83          83
Combined profit and loss account                              557         481
                                                           --------   ---------
Equity shareholders' funds                                  1,241       1,113
Equity minority interests                                       5           4
                                                           --------   ---------
                                                            1,246       1,117
                                                           --------   ---------
                                        17

Brambles

COMBINED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the year ended 30 June 2005

                                                             2005         2004
                                                       £ millions   £ millions
                                                       ------------------------
Profit for the year:
- Group                                                       211          118
- Joint ventures                                                7            6
- Associates                                                    1            2
                                                           --------    --------
Profit attributable to parent companies'shareholders          219          126
Exchange translation difference                                51          (67)
                                                           --------    --------
Total recognised gains and losses for the year                270           59
                                                           --------    --------

RECONCILIATION OF MOVEMENTS IN COMBINED SHAREHOLDERS' FUNDS
for the year ended 30 June 2005

                                                             2005         2004
                                                       £ millions   £ millions
                                                       ------------------------
Combined shareholders' funds at
beginning of year                                           1,113        1,185

Profit attributable to parent companies'shareholders          219          126
Ordinary dividends paid and proposed                         (152)        (136)
Issue of ordinary shares, net of expenses                       6            -
Shares issued to employees under long term incentive plan      (1)           -
Reinstatement of goodwill due to sale of businesses             -            5
Performance shares to be issued to employees under
long term incentive plan                                        5            -
Exchange translation difference:
- Brambles Industries Limited share capital                    49          (28)
- Other                                                         2          (39)
                                                           --------    ---------
Net increase/(decrease) in combined shareholders'funds        128          (72)
                                                           --------    ---------
Combined shareholders' funds at end of year                 1,241        1,113
                                                           --------    ---------
                                        18

Brambles

COMBINED CASH FLOW STATEMENT
for the year ended 30 June 2005

                                                             2005         2004
                                                       £ millions   £ millions
                                                       ------------------------
Net cash inflow from operating activities                     841          737
                                                           --------   ---------
Dividends received from joint ventures and associates           8            7
                                                           --------   ---------
Interest received                                               3            6
Interest paid                                                 (63)         (74)
Interest element of finance lease rentals                      (1)          (1)
                                                           --------   ---------
Returns on investments and servicing of finance               (61)         (69)
                                                           --------   ---------
Tax paid                                                      (90)         (82)
                                                           --------   ---------
Purchase of tangible fixed assets                            (428)        (398)
Sale of tangible fixed assets                                  65           50
Investment loans and other financial investments                2            4
                                                           --------   ---------
Capital expenditure and financial investment                 (361)        (344)
                                                           --------   ---------
Purchase of subsidiary undertakings and associates            (28)         (42)
Net cash acquired with subsidiary undertakings                  -            3
Sale of subsidiary undertakings and associates                  7           29
                                                           --------   ---------
Acquisitions and disposals                                    (21)         (10)
                                                           --------   ----------
Equity dividends paid to parent companies'shareholders       (137)        (139)
                                                           --------   ----------
Net cash inflow before management
of liquid resources and financing                             179          100
                                                           --------   ----------
Management of liquid resources                                  1           (3)
                                                           --------   ----------
Net proceeds from share issues                                  6            1
Net proceeds from hedge borrowings                              -           14
Decrease in borrowings                                       (105)        (127)
Capital element of finance lease rentals                       (3)          (5)
                                                           --------   ----------
Financing                                                    (102)        (117)
                                                           --------   ----------
Increase/(decrease) in cash                                    78          (20)
                                                           --------   ----------

                                        19

Brambles

MOVEMENT IN COMBINED NET DEBT
for the year ended 30 June 2005

                                                             2005          2004
                                                       £ millions    £ millions
                                                       ------------------------

Increase/(decrease) in cash                                 78             (20)
Decrease in borrowings                                     105             127
Capital element of finance lease rentals                     3               5
Currency variations                                        (22)             80
(Decrease)/increase in liquid resources                     (1)              3
Other non-cash changes                                       4              18
Subsidiaries acquired and sold                              (2)             (1)
                                                        --------      ----------
Total movement                                             165             212
                                                        --------      ----------
Net borrowings at beginning of year                     (1,395)         (1,607)
                                                        --------      ----------
Net borrowings at end of year                           (1,230)         (1,395)
                                                        --------      ----------



RECONCILIATION OF OPERATING PROFIT TO NET CASH
INFLOW FROM OPERATING ACTIVITIES
for the year ended 30 June 2005

                                                             2005          2004
                                                       £ millions    £ millions
                                                       ------------------------

Group operating profit                                      404           258

Depreciation charge and impairment                          324           332
Amortisation and impairment                                  35            54
Irrecoverable pooling equipment provision expense            62            39
Decrease in working capital                                  22            54
Increase in provisions                                        6             7
Other                                                       (12)           (7)
                                                         --------    ----------
Net cash inflow from operating activities                   841           737
                                                         --------    ----------
                                        20

Brambles

COMBINED SEGMENTAL ANALYSIS
for the year ended 30 June 2005



Brambles' material business segments are CHEP (pallet and container pooling), Cleanaway (waste 
management), Recall (information management) and Brambles Industrial Services. The Regional 
Businesses segment comprises Interlake, TCR and Eurotainer. The Discontinued segment 
comprises Meineke, sold in August 2003.

                                               Turnover          Comparable operating
                                                                      profit 1
                                               2005       2004         2005        2004
                                           £ millions  £ millions  £ millions  £ millions
                                           ----------------------------------------------
  By business segment
  CHEP                                        1,488      1,394        290        224
  Cleanaway                                   1,094      1,037         82         89
  Recall                                        291        274         47         43
  Brambles Industrial Services                  301        287         38         34
  Regional Businesses                           133        117          9          5
  Corporate                                       -          -        (14)       (15)
                                             --------   --------   --------    -------
  Total continuing businesses                 3,307      3,109        452        380
  Discontinued                                    -          3          -          1
                                             --------   --------   --------    -------
                                              3,307      3,112        452        381
                                             --------   --------   --------    -------
By geographic origin
Europe                                        1,768      1,656        208        179
Americas                                        896        855        135        100
Australia/New Zealand                           558        519         86         82
Rest of the World                                85         82         23         20
                                             --------   --------   --------    -------
                                              3,307      3,112        452        381
                                             --------   --------   --------    -------


1 Comparable operating profit is profit before interest, tax, goodwill amortisation and exceptional items 
(EBITA before exceptionals). The difference between comparable operating profit and profit before interest 
and tax is due to goodwill amortisation and exceptional items. Goodwill amortisation by segment is CHEP 
£2 million (2004: £1 million), Cleanaway £15 million (2004: £15 million), Recall £13 million (2004:
£13 million), Brambles Industrial Services £5 million(2004: £5 million), Regional Businesses nil (2004:
£1 million). In the current financial year, there was an exceptional profit before interest and tax of £4
million in Recall. In the 2004 financial year, exceptional items by segment were CHEP £(44) million,
Cleanaway £(14) million, Brambles Industrial Services £(3) million, Regional Businesses £(20) million and 
Discontinued £33 million.

                                        21

Brambles

COMBINED SEGMENT ANALYSIS continued
for the year ended 30 June 2005

                                    Profit before
                                   interest and tax
                             (after goodwill amortisation            Non-operating
                               and exceptional items)              exceptional items
                                    2005            2004            2005         2004
                              £ millions      £ millions      £ millions   £ millions
                             --------------------------------------------------------

By business segment
CHEP                             288             179                -              -
Cleanaway                         67              60                -             (3)
Recall                            38              30                4              -
Brambles Industrial Services      33              26                -             (3)
Regional Businesses                9             (16)               -              -
Corporate                        (14)            (15)               -              -
                             --------------------------------------------------------
Total continuing businesses      421             264                4             (6)
Discontinued                       -              34                -             33
                             --------------------------------------------------------
                                 421             298                4             27
                             --------------------------------------------------------

By geographic origin
Europe                           184             105                -             (2)
Americas                         132              97                4             30
Australia/New Zealand             82              79                -             (1)
Rest of the World                 23              17                -              -
                             --------------------------------------------------------
                                 421             298                4             27
                             --------------------------------------------------------

                                                   Net assets
                                                         2005             2004
                                                   £ millions       £ millions
                                                   -----------------------------
By business segment
CHEP                                                    1,532            1,534
Cleanaway                                                 620              617
Recall                                                    327              321
Brambles Industrial Services                              230              209
Regional Businesses                                        78               76
Corporate                                                (117)             (83)
                                                       --------         --------
Total continuing businesses                             2,670            2,674
Discontinued                                                -               (3)
                                                       --------         --------
Total segmented net operating assets                    2,670            2,671
                                                       --------         --------

By geographic origin
Europe                                                  1,432            1,478
Americas                                                  928              920
Australia / New Zealand                                   344              291
Rest of the World                                          83               65
Corporate                                                (117)             (83)
                                                       --------         --------

Total segmented net operating assets                    2,670            2,671
                                                       --------         --------
Total segmented net operating assets                    2,670            2,671
Net debt                                               (1,230)          (1,395)
Corporation tax receivable                                  9               18
Current corporation tax                                   (52)             (35)
Deferred tax                                             (151)            (142)
                                                       --------         --------
Net assets                                              1,246            1,117
                                                       --------         --------

The above segment analysis includes Brambles' share of amounts reported by joint
ventures and associates.

                                        22

Brambles

NOTES TO THE COMBINED FINANCIAL INFORMATION
for the year ended 30 June 2005


1       BASIS OF PREPARATION

The dual listed companies structure (DLC Structure) is essentially a contractual
arrangement between Brambles Industries Limited (BIL) and Brambles Industries
plc (BIP) under which they operate as if they are a single economic enterprise,
while retaining their separate legal identities, tax residencies and stock
exchange listings. The combination did not involve the acquisition of one
company by the other or any transfer of shares or other assets between BIL and
BIP. This structure unites the economic interests of the two shareholder groups.

Combined financial information represents the combined businesses of BIL and BIP
and encompasses their respective subsidiaries, associates and joint ventures.
BIL and BIP are referred to collectively throughout these financial statements
as Brambles.

Combined financial information has been presented in order to provide
shareholders with a fuller picture of the combined economic interests of
Brambles. It has been prepared under merger accounting principles, as set out in
Financial Reporting Standard 6: Acquisitions and Mergers. Under merger
accounting the results and cash flows of BIP and BIL have been combined from the
beginning of the 2002 financial year.

Consolidated financial information for BIP is presented on pages 34 to 37.

Accounting policies

The preliminary results for the year ended 30 June 2005 have been prepared on
the basis of the accounting policies set out in the 2004 Annual Review.

A reconciliation between UK GAAP and Australian GAAP (AGAAP) is presented in
Note 7.

                                        23

Brambles

NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005


2       EARNINGS PER SHARE

Earnings per share (EPS) for 2005 is based on the earnings of the year of £219
million (2004: £126 million) and calculated on the weighted average number of
1,691.8 million (2004: 1,690.7 million) shares in issue and ranking for
dividend. Diluted EPS, which takes into account options over shares, is
calculated on the weighted average number of 1,705.2 million (2004: 1,692.8
million) shares.

EPS before goodwill amortisation and exceptional items, which the Directors
consider gives a useful additional indication of underlying performance, is
calculated on the earnings of the year adjusted as follows:

                                          Earnings                   EPS
                                      2005          2004      2005        2004
                                  £ millions  £ millions     pence       pence
                                  ----------------------------------------------

Profit for the year                    219           126     12.9          7.5
Included in operating profit:
- Goodwill amortisation                 35            35      2.1          2.0
- Exceptional items                      -            75        -          4.4
Non-operating exceptional items         (4)          (27)    (0.2)        (1.6)
Minority interest in exceptional items   -            (1)       -            -
Tax attributable to exceptional items    4             2      0.2          0.1
                                  ----------------------------------------------
Profit after tax before goodwill
amortisation and exceptional items     254           210     15.0         12.4
                                  ----------------------------------------------

                                        24

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005

3       EXCEPTIONAL ITEMS

                                                               2005        2004
                                                         £ millions  £ millions
                                                         -----------------------
Operating exceptional items:
- Reorganisation costs 1                                         -         (53)
- Goodwill impairment 2                                          -         (19)
- Write-down of fixed assets 3                                   -          (3)
                                                           ---------   ---------
Total operating exceptional items                                -         (75)

Non-operating exceptional items:
Profit on sale of investments 4                                  4           -
Net profit/(loss) on sale of discontinued operations:
- Profit on sale of discontinued operations 5                    -          34
- Loss on sale of discontinued operations and associates 5       -          (7)
                                                           ---------   ---------
Net profit/(loss) on sale of discontinued operations             -          27
                                                           ---------   ---------
Total non operating exceptional items                            4          27
                                                           ---------   ---------
Total exceptional items before tax                               4         (48)
                                                           ---------   ---------

Operating exceptional tax 6                                    (13)          9
Tax on non-operating exceptional items:
Tax on profit on sale of investments 4                          (1)          -
Tax on net profit/(loss) on sale of discontinued operations:
- Tax on profit on sale of discontinued operations 5            10         (13)
- Tax on loss on sale of discontinued operations                 -           2
                                                           ---------   ---------
Total tax on exceptional items                                  (4)         (2)
                                                           ---------   ---------
Exceptional items after tax                                      -         (50)
                                                           ---------   ---------


1 Reorganisation costs in 2004 comprise redundancy costs, pallet writedowns and
other related costs in CHEP Europe of £38 million, costs associated with the
reorganisation of CHEP's management structure of £6 million and other
restructuring costs, principally in Cleanaway, of £9 million.

2 An impairment charge of £19 million (£17 million after tax) was booked in 2004
against the carrying value of goodwill in Interlake, which forms part of the
Regional Businesses segment.

3 The carrying amount of the fixed assets in Cleanaway's gas to energy business
in Taiwan was written down by £3 million to recoverable amount in 2004. Of this
amount, £1 million was attributable to equity minority interests.

4 In March 2005, Recall sold its investment in Hyland Software for net proceeds
of £10 million, resulting in a net profit on sale of £4 million (£3 million
after tax).

5 Brambles disposed of various businesses during the prior year, one of which is
individually material being the sale of Meineke Car Care Centers, Inc (Meineke)
for net proceeds of £42 million. This resulted in a profit on sale of
£30 million (£17 million after tax). During 2005, the tax liability arising on
this transaction was reassessed, leading to a reduction in the liability of £10
million.

6 During 2005, a detailed review was undertaken of the allocation of goodwill
and related deferred tax balances to the underlying subsidiaries of Cleanaway
Germany. As a result, an additional deferred tax liability of £13 million has
been recognised.

                                        25

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005


4       EQUITY DIVIDENDS
                                                                         2005       2004
                                                                   £ millions £ millions
                                                                   ---------------------       
BIP:
- Interim paid 4.156 pence per share (2004: 4.155 pence)                 30         30
- Second interim declared 4.815 pence per share (2004:3.918 pence)       36         28
                                                                    --------------------
                                                                         66         58
BIL:
- Interim paid 10.0 cents per share (2004: 10.0 cents)                   39         41
- Final declared 11.5 cents per share (2004: 10.0 cents)                 47         37
                                                                    --------------------
                                                                         86         78
                                                                    --------------------  
                                                           Total        152        136
                                                                    --------------------

5       CONTINGENT LIABILITIES

There have been no material changes in Brambles' contingent liabilities set out in the 2004 Annual Review.

                                        26

Brambles

NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005

6 TAX ON PROFIT ON ORDINARY ACTIVITIES
                                                               2005        2004
                                                         £ millions  £ millions
                                                         -----------------------
Current tax:
UK corporation tax charge:
- Corporation tax                                               29          21
- Adjustments in respect of prior periods                        1           2
Overseas tax charge:
- Corporation tax                                               87          59
- Adjustments in respect of prior periods                        2           1
Joint ventures                                                   2           2
Associates                                                       1           1
                                                           ---------    --------
Total current tax                                              122          86

Deferred tax:
- Origination and reversal of timing differences                 7           8
- Adjustments in respect of prior periods                       (2)          5
                                                           ---------    --------
Total deferred tax                                               5          13
                                                           ---------    --------
Tax on profit on ordinary activities                           127          99
                                                           ---------    --------

The actual current tax charge differs from the UK standard rate
of 30% (2004: 30%) for the reasons set out below:

Profit on ordinary activities before tax                       347         224
                                                           ---------    --------
Tax on profit on ordinary activities at standard               104          67
rate

Factors affecting charge:
- Capital allowances in excess of depreciation                  (5)        (40)
- Change in provisions                                           8           2
- Other timing differences                                      (3)          -
- Other net expenses not deductible for tax purposes             9          10
- Foreign tax charged at different rates                        11           7
- Utilisation of tax losses brought forward                    (13)         (1)
- Unrelieved tax losses carried forward                          8          38
- Adjustments to tax charge in respect of prior periods          3           3
                                                           ---------    --------
                                                               122          86
                                                           ---------    --------

The benefit for tax losses will only be obtained if:
(i) Brambles derives future assessable income of a nature and of an amount sufficient to enable the benefit 
    from the deductions for the losses to be realised; and
(ii) Brambles continues to comply with the conditions for deductibility imposed by tax legislation; and
(iii)No changes in tax legislation adversely affect Brambles in realising the benefit from the deductions for 
     the losses.

                                        27

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005

7.       GAAP RECONCILIATION - UK GAAP TO AUSTRALIAN GAAP (unaudited)


(a)     2005

                                        2005       2005        GAAP adjustments in A$ millions         2005
                                                           ------------------------------------               
                                      UK GAAP    UK GAAP     JVs and               Share              AGAAP
                                    £ millions A$ millions Associates   Goodwill   plans   Total   A$ millions
                                    --------------------------------------------------------------------------
TURNOVER (including share
of joint ventures and associates)      3,307    8,151.0            -          -       -       -    8,151.0
                                    -------------------------------------------------------------------------- 

OPERATING PROFIT
Continuing operations before
goodwill amortisation and
exceptional items                        438    1,074.9            -          -    13.1    13.1    1,088.0
Goodwill amortisation                    (34)     (82.7)           -      (16.9)      -   (16.9)     (99.6)
Exceptional items                          -          -            -          -       -       -          -
                                       -------   --------     --------    -------  ------ -------    -------
Continuing operations                    404      992.2            -      (16.9)   13.1    (3.8)     988.4
Discontinued operations                    -          -            -          -       -       -          -
                                       -------   --------     --------    -------  ------ -------    -------

GROUP OPERATING PROFIT                   404      992.2            -      (16.9)   13.1    (3.8)     988.4
Share of operating profit of
joint ventures and associates             13       32.9        (13.4)         -       -   (13.4)      19.5
                                       -------   --------     --------    -------  ------ -------    -------

TOTAL OPERATING PROFIT                   417    1,025.1        (13.4)     (16.9)   13.1   (17.2)   1,007.9

NON-OPERATING
EXCEPTIONAL ITEMS
Net profit on sale of investments          4        9.8            -          -       -       -        9.8
                                       -------   --------     --------    -------  ------ -------    -------

PROFIT BEFORE INTEREST                   421    1,034.9        (13.4)     (16.9)   13.1   (17.2)   1,017.7
AND TAX

Net interest payable                     (74)    (181.8)         5.3          -       -     5.3     (176.5)
                                       -------   --------     --------    -------  ------ -------    -------

PROFIT BEFORE TAX                        347      853.1         (8.1)     (16.9)   13.1   (11.9)     841.2

Tax                                     (127)    (311.9)         8.1       (0.8)   (5.4)    1.9     (310.0)
                                       -------   --------     --------    -------  ------ -------    -------

PROFIT AFTER TAX                         220      541.2            -      (17.7)    7.7   (10.0)     531.2

Minority interests                        (1)      (2.4)           -          -       -       -       (2.4)
                                       -------   --------     --------    -------  ------ -------    -------
ATTRIBUTABLE PROFIT                      219      538.8            -      (17.7)    7.7   (10.0)     528.8
                                       -------   --------     --------    -------  ------ -------    -------

A$ amounts are presented to one decimal place to conform with materials released in Australia.

                                        28

Brambles

NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005


7.       GAAP RECONCILIATION - UK GAAP TO AUSTRALIAN GAAP (unaudited) continued


(b)     2004

                                        2004       2004   GAAP adjustments in A$ millions         2004
                                                          -------------------------------------
                                      UK GAAP    UK GAAP    JVs and                                 AGAAP
                                    £ millions A$millions Associates   Goodwill   Other   Total   A$millions
                                    ------------------------------------------------------------------------
                                    
TURNOVER (including share
of joint ventures and associates)      3,112    7,652.3       -              -       -       -    7,652.3
                                    ------------------------------------------------------------------------  

OPERATING PROFIT
- Continuing operations before
goodwill amortisation and
exceptional items                       366      901.5        -              -    (1.1)   (1.1)     900.4
- Goodwill amortisation                 (34)     (84.1)       -           (18.3)     -   (18.3)    (102.4)
- Exceptional items                     (75)    (184.1)       -              -       -       -     (184.1)
                                    --------   --------   -------         ------- ------- -------   --------
Continuing operations                   257      633.3        -           (18.3)   (1.1)  (19.4)     613.9
Discontinued operations                   1        2.3        -              -       -       -         2.3
                                    --------   --------   -------         ------- ------- -------   --------

GROUP OPERATING PROFIT                  258      635.6        -           (18.3)   (1.1)  (19.4)     616.2
                                    --------   --------   -------         ------- ------- -------   --------
Share of operating profit of
joint ventures and associates            13       32.4      (11.9)           -       -    (11.9)      20.5
                                    --------   --------   -------         ------- ------- -------   --------

TOTAL OPERATING PROFIT                  271      668.0      (11.9)        (18.3)   (1.1)  (31.3)     636.7

NON-OPERATING
EXCEPTIONAL ITEMS
Net profit on sale of                    27       66.8        -            13.1      -     13.1       79.9
discontinued operations
                                      --------   --------  -------        ------- ------- -------   --------

PROFIT BEFORE INTEREST                  298      734.8      (11.9)         (5.2)   (1.1)  (18.2)     716.6
AND TAX

Net interest payable                    (74)    (181.2)       4.1             -       -     4.1     (177.1)
                                      --------   --------   -------       ------- ------- -------   --------
PROFIT BEFORE TAX                       224      553.6       (7.8)         (5.2)   (1.1)  (14.1)     539.5

Tax                                     (99)    (242.8)       7.8           2.0    (3.0)    6.8     (236.0)
                                      --------   --------   -------        ------- ------- -------   --------

PROFIT AFTER TAX                        125      310.8         -           (3.2)   (4.1)   (7.3)     303.5

Minority interests                        1        3.1         -              -       -       -        3.1
                                      --------   --------   -------        ------- ------- -------   --------

ATTRIBUTABLE PROFIT                     126      313.9         -           (3.2)   (4.1)   (7.3)     306.6
                                      --------   --------   -------        ------- ------- -------   --------

A$ amounts are presented to one decimal place to conform with materials released in Australia.

                                        29

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005



8 IMPACT OF ADOPTING INTERNATIONAL FINANCIAL REPORTING STANDARDS

UNAUDITED
Brambles continues the transitioning of its accounting policies and financial
reporting from current UK and Australian Standards to International Financial
Reporting Standards (IFRS). Brambles has allocated internal and external
resources to the transition project. Building on diagnostics and impact
assessments undertaken at the start of the project, the project team has
addressed in detail the transition issues in the key areas that will be affected
by the transition to IFRS. The IFRS steering committee has met regularly to
oversee progress and has made accounting policy recommendations and
presentations to the Audit Committee. External actuarial consultants have
performed valuations in relation to employer sponsored defined benefit
superannuation funds and to share-based payments. Training courses on IFRS have
been given to key accounting staff throughout Brambles. A management
presentation was given to analysts in June 2005 to highlight the anticipated
impact of IFRS on Brambles.

As Brambles has a 30 June year end, priority has been given to the preparation
of an opening balance sheet in accordance with IFRS as at 1 July 2004, Brambles'
date of transition to IFRS. This will form the basis of accounting for IFRS in
the future. Most adjustments required on transition to IFRS will be made
retrospectively against opening retained earnings as at 1 July 2004.

Brambles will prepare its half-year results at 31 December 2005 under IFRS and
will present comparative figures under IFRS for the half-year to 31 December
2004. Brambles' first fully IFRS-compliant financial report will be for the year
ending 30 June 2006, and will contain IFRS comparative figures for the year
ended 30 June 2005.

Set out below are the key areas where accounting policies will change and are
expected to have a material impact on the financial report of Brambles, together
with the best estimate of the quantitative impact of the changes on total equity
as at 1 July 2004 (the date of transition) and 30 June 2005, and on net profit
for the year ended 30 June 2005. No material impacts are expected in relation to
the statement of cash flows.

The amounts disclosed are management's best estimates of the quantitative impact
of the changes as at the date of this report and are unaudited. Although the
amounts disclosed in this note are based on management's best knowledge of
expected standards and interpretations, and current facts and circumstances,
these may change. For example, amended or additional standards or
interpretations may be issued by the IASB, or there may be changes due to
emerging accepted practice in the interpretation and application of IFRS.
Therefore, until the Company prepares its first full IFRS financial statements
for the year ended 30 June 2006, the possibility cannot be excluded that the
accompanying quantified impacts may have to be adjusted.

Defined benefit pension plans
-----------------------------
Under IAS 19 Employee Benefits, Brambles will recognise as a liability the net
deficit in its employer sponsored defined benefit superannuation funds, based on
actuarial calculations of the position of the funds. This will result in a
change to Brambles' current accounting policy where the expected cost of
providing superannuation, as calculated periodically by professionally qualified
actuaries, is recognised in the profit and loss account by spreading the cost
over the service lives of employees in the schemes.

Actuarial calculations were completed as at 1 July 2004 and 30 June 2005. The
estimated impact of the introduction of IFRS will be to recognise a defined
benefit plan deficit of £94 million and a deferred tax asset of £29 million.
Prepayments of £2 million in relation to SSAP 24 accounting that previously
applied under UK GAAP will be reversed. A net transitional adjustment estimated
at £67 million will be taken as a reduction in opening retained earnings.

For the year ended 30 June 2005, employee benefit expense under IFRS is expected
to be approximately £2 million higher after tax than that under UK GAAP.

                                        30

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005

8 IMPACT OF ADOPTING INTERNATIONAL FINANCIAL REPORTING STANDARDS continued


UNAUDITED

Defined benefit pension plans continued
---------------------------------------

Brambles has elected to early adopt the amendment to IAS 19 in order to
recognise actuarial gains and losses in the statement of recognised income and
expense. Actuarial calculations at 30 June 2005 indicate that the actuarial
result for the year ended 30 June 2005 will be a loss of £35 million, before a
related tax credit of £11 million. The actuarial loss and related tax credit
will be booked in the statement of recognised income and expense and will not
directly impact reported profit.

Goodwill
--------
Under IFRS 3 Business Combinations, goodwill will no longer be amortised but
instead will be subject to rigorous annual impairment testing. This will result
in a change to Brambles' current accounting policy which amortises goodwill over
its useful life up to a maximum of 20 years. Brambles has elected to make use of
the transitional exemption available under IFRS 1 First-time adoption of
International Financial Reporting Standards and will not restate any business
combinations that occurred prior to 1 July 2004.

The transitional provisions of IFRS 1 provide that certain previous GAAP
treatments may be frozen on transition to IFRS. In order to achieve a single set
of IFRS financial statements from two legacy GAAP's, Australian and UK, it is
necessary in certain limited respects to first align the UK GAAP accounting
methods with those used under Australian GAAP. On the introduction of IFRS, the
legacy goodwill balances under UK GAAP and AGAAP will be aligned. Previously, u
nder UK GAAP, goodwill arising on pre-1998 acquisitions was written off to
reserves and not subject to an annual amortisation charge. On the introduction
of IFRS, this pre-1998 goodwill will be reinstated as part of the goodwill
balance, with a corresponding adjustment to accumulated amortisation to reflect
the amortisation that would have been charged had the write-off not been booked.
The net increase in goodwill balance due to pre-1998 goodwill will be £65
million, with a corresponding reduction in deferred tax liability of £6 million.

Additionally, due to differing UK GAAP and AGAAP treatment of pre-acquisition
tax losses, the AGAAP goodwill balance at 1 July 2004 on certain acquisitions
was £17 million lower than the corresponding UK GAAP amount. To enable the
presentation of a common set of financial statements under IFRS in both the UK
and Australia, the UK GAAP goodwill amount for those acquisitions will be
aligned with the legacy AGAAP balance. The net decrease in goodwill balances due
to pre-acquisition tax losses will be £17 million.

The net impact of these transitional adjustments will be an increase in goodwill
of £48 million, a reduction in deferred tax liability of £6 million and a net
increase in opening retained earnings of £54 million based on the UK GAAP
financial statements.

For the year ended 30 June 2005, goodwill amortisation of £34 million booked
under UK GAAP will be reversed, as will a related tax credit of £5 million. The
goodwill balance at 30 June 2005 will be £82 million higher under IFRS than
under UK GAAP, with the related deferred tax liability under IFRS £1 million
lower than under UK GAAP.

Intangible assets
-----------------

IAS 38 Intangible Assets requires that capitalised software and software
development costs be presented as an intangible asset, in contrast to Brambles'
previous practice under UK GAAP which has presented such assets within tangible
fixed assets. A transitional reclassification estimated at £84 million will
therefore be made from tangible fixed assets to intangible assets. At 30 June
2005, the cumulative reclassification is estimated at £70 million. There will be
no impact on the effective life of the capitalised items or to net profit.

                                        31

Brambles


NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005


8 IMPACT OF ADOPTING INTERNATIONAL FINANCIAL REPORTING STANDARDS continued


UNAUDITED

Dividend provision
------------------

Under IAS 37 Provisions, Contingent Assets and Contingent liabilities, provision
can only be made for a dividend that has been declared as at balance sheet date.
This differs from current UK GAAP practice whereby any dividends declared before
the financial statements are finalised are taken up in those financial
statements. A provision of £65 million for the second interim dividend for the
year ended 30 June 2004, which was declared by the Directors in August 2004, was
booked under UK GAAP but will be reversed under IFRS with a corresponding
increase in retained earnings at that date. The dividend will be recognised when
paid in the following year. A similar adjustment will be made for the second
interim dividend of £83 million for the year ended 30 June 2005, which was
declared by the Directors in August 2005.

Share-based payments
--------------------

Under IFRS 2 Share-based Payments, Brambles will recognise the fair value of
options and performance shares granted to employees since 7 November 2002 as an
expense in the income statement on a pro-rata basis over the vesting period,
with a corresponding adjustment to equity for equity settled awards and to
provisions for cash settled ('phantom') awards. Under UK GAAP, only performance
shares, which are issued at a discount to market price, are recognised as an
expense.

A transitional adjustment estimated at £3 million will be taken as a reduction
in retained earnings as at 1 July 2004 with a corresponding increase in equity
of £2 million and in provisions of £1 million.

For the year ended 30 June 2005, the employee benefit expense under IFRS is
estimated to be £4 million higher than under UK GAAP with a corresponding
increase in equity of £4 million.

Financial instruments
---------------------

Brambles has decided to apply the exemption provided in IFRS 1 which permits
entities not to apply the requirements of IAS 32 Financial Instruments:
Presentation and Disclosures and IAS 39 Financial Instruments: Recognition and
Measurement for the financial year ended 30 June 2005. The standards will be
applied from 1 July 2005 and therefore will have no impact on the financial
statements at 30 June 2005. As permitted by IFRS 1, Brambles will not apply IAS
32 and IAS 39 to the 2005 comparatives published in its 2006 financial
statements.

From 1 July 2005, financial instruments will be carried at either amortised cost
or fair value, depending on which of the five categories set out in the standard
applies to the instruments. Movements in fair value will be either charged to
net profit or loss or taken to equity in accordance with IAS 39. This will
result in a change to Brambles' current accounting policy which does not
classify financial instruments. Current measurement is at amortised cost, with
certain derivative financial instruments not recognised as assets or
liabilities.

Foreign exchange contracts held for hedging purposes will be classified as cash
flow hedges or fair value hedges, on the basis of the qualifying criteria
outlined in IAS 39. This will result in the recognition of hedging instruments
as assets or liabilities, with resulting gains or losses being charged to net
profit or loss or taken to equity in accordance with the hedge accounting rules
in IAS 39. Currently, costs and gains arising from some contracts used for
hedging purposes, along with any realised or unrealised losses or gains from
re-measurement, are included in assets or liabilities as deferred losses or
deferred gains.

Brambles has updated its hedging policies to reflect IFRS requirements and has
the necessary documentation and effectiveness testing methodologies in place to
ensure compliance with IFRS requirements from 1 July 2005. Brambles anticipates
that its hedging activities will be highly effective such that there will be
only limited volatility on its future operating profits as a result of hedge
ineffectiveness.

                                        32

Brambles

NOTES TO THE COMBINED FINANCIAL INFORMATION continued
for the year ended 30 June 2005

8 IMPACT OF ADOPTING INTERNATIONAL FINANCIAL REPORTING STANDARDS continued


UNAUDITED

Presentation currency
---------------------

From 1 July 2005, Brambles will be using the US dollar as its presentation
currency when preparing combined financial statements under IFRS. Sterling
combined financial statements will no longer be prepared.

No change is proposed to the currency in which dividends are declared and paid.


                                        33



Brambles Industries plc

Company No 4134697


CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the year ended 30 June 2005


                                                                      2005          2004
                                                                    £ millions  £ millions 
                                                                    ----------------------
TURNOVER (including share of joint ventures and associates)
- Continuing operations                                              2,327       2,187
- Discontinued operations                                                -           2
                                                                    --------    --------
                                                                     2,327       2,189

Less share of joint ventures and associates - continuing operations    (52)        (48)
                                                                    --------    --------

GROUP TURNOVER                                                       2,275       2,141
                                                                    --------    --------

OPERATING PROFIT
Continuing operations before goodwill amortisation and
exceptional items                                                      286         220
Goodwill amortisation                                                  (15)        (16)
Exceptional items                                                        -         (71)
                                                                    --------    --------
Continuing operations                                                  271         133
Discontinued operations                                                  -           1
                                                                    --------    --------
GROUP OPERATING PROFIT                                                 271         134

Share of operating profit of joint ventures and associates
- continuing operations                                                  4           4
                                                                    --------    --------

TOTAL OPERATING PROFIT                                                 275         138

Net profit on sale of discontinued operations                            -          27
                                                                    --------    --------
PROFIT ON ORDINARY ACTIVITIES BEFORE INTEREST AND TAX                  275         165
Net interest payable                                                   (65)        (67)
                                                                    --------    --------

PROFIT ON ORDINARY ACTIVITIES BEFORE TAX                               210          98
Tax on profit on ordinary activities                                   (75)        (56)
                                                                    --------    --------

PROFIT ON ORDINARY ACTIVITIES AFTER TAX                                135          42
Equity minority interest                                               (55)        (15)
                                                                    --------    --------

PROFIT ATTRIBUTABLE TO SHAREHOLDERS                                     80          27
Equity dividends paid and proposed                                     (66)        (58)
                                                                    --------    --------

RETAINED PROFIT/(LOSS) FOR THE YEAR TRANSFERRED
TO/(FROM) RESERVES                                                      14         (31)
                                                                    --------    --------
Basic earnings per share (pence)                                      11.1         3.7
Diluted earnings per share (pence)                                    11.0         3.7
                                                                    --------    --------

                                        34


Brambles Industries plc

Company No 4134697


CONSOLIDATED BALANCE SHEET
for the year ended 30 June 2005

                                                          2005              2004
                                                    £ millions        £ millions
                                                    ----------------------------
FIXED ASSETS
Intangible assets                                           196           209
Tangible fixed assets and investments                     1,765         1,783
                                                         --------      --------
                                                          1,961         1,992
                                                         --------      --------
CURRENT ASSETS
Stock                                                        30            24
Debtors                                                     462           431
Cash at bank and in hand                                     44            15
                                                         --------      --------
                                                            536           470
                                                         --------      --------
CREDITORS: amounts falling due within one year             (479)         (854)
                                                         --------      --------
NET CURRENT ASSETS/(LIABILITIES)                             57          (384)
                                                         --------      --------

TOTAL ASSETS LESS CURRENT LIABILITIES                     2,018         1,608

CREDITORS: amounts falling due after more than one year  (1,012)         (782)
Provisions for liabilities and charges                     (212)         (207)
                                                         --------      --------
NET ASSETS                                                  794           619
                                                         --------      --------

CAPITAL AND RESERVES
Share capital                                                36            36
Share premium account                                        51            50
Other reserves                                               83            83
Profit and loss account                                     157           138
                                                         --------      --------
Equity shareholders' funds                                  327           307
Equity minority interests                                   467           312
                                                         --------      --------
                                                            794           619
                                                         --------      --------




CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the year ended 30 June 2005

                                                             2005           2004
                                                       £ millions     £ millions
                                                       -------------------------

Profit attributable to shareholders                          80             27
Exchange translation differences                              3            (23)
                                                         --------       --------
Total recognised gains and losses for the year               83              4
                                                         --------       --------
                                        35

Brambles Industries plc

Company No 4134697


CONSOLIDATED CASH FLOW STATEMENT
for the year ended 30 June 2005

                                                               2005         2004
                                                         £ millions   £ millions
                                                        ------------------------
Net cash inflow from operating activities                      588         524
                                                           ---------    --------
Dividends received from associates                               3           4
                                                           ---------    --------
Interest received                                               26          31
Interest paid                                                  (90)        (93)
Interest element of finance lease rentals                        -          (1)
Dividends paid to minority shareholders in subsidiary
undertakings                                                    (5)         (4)
                                                           ---------    --------

Returns on investments and servicing of finance                (69)        (67)
                                                           ---------    --------
UK corporation tax paid                                        (25)        (22)
Overseas corporate tax paid                                    (22)        (17)
                                                           ---------    --------
Taxation paid                                                  (47)        (39)
                                                           ---------    --------
Purchase of tangible fixed assets                             (291)       (297)
Proceeds from sale of tangible fixed assets                     39          27
Investment loans and other financial investments               (10)          3
                                                           ---------    --------
Capital expenditure and financial investment                  (262)       (267)
                                                           ---------    --------
Purchase of subsidiary undertakings and associates               -          (9)
Sale of businesses                                               -          45
                                                           ---------    --------
Acquisitions and disposals                                       -          36
                                                           ---------    --------
Equity dividends paid to shareholders                          (58)        (59)
                                                           ---------    --------
Net cash inflow/(outflow) before management of
liquid resources and financing                                 155         132
                                                           ---------    --------
Management of liquid resources                                   -          (1)
                                                           ---------    --------
Proceeds from share issue                                        1           -
Increase in investment in subsidiary by a BIL group company    107           -
Decrease in borrowings                                        (248)       (148)
                                                           ---------    --------
Financing                                                     (140)       (148)
                                                           ---------    --------
Increase/(decrease) in cash                                     15         (17)
                                                           ---------    --------

                                        36

Brambles Industries plc

Company No 4134697


NOTES TO THE BRAMBLES INDUSTRIES PLC FINANCIAL INFORMATION
for the year ended 30 June 2005



1       Basis of preparation
----------------------------

BIP was incorporated on 3 January 2001. On 7 August 2001, the support services
activities of GKN plc were transferred to BIP by way of a court approved
reduction of capital of GKN plc and the issue of ordinary shares in BIP to the
shareholders of GKN plc as part of the combination transaction.

The above transaction was accounted for as a group reconstruction under merger
accounting principles. The results and cash flows of the relevant entities were
combined from the beginning of the 2002 financial year and their assets and
liabilities combined at the amounts at which they were previously recorded.

In preparing the financial information, the results, and assets and liabilities
of the 50 per cent joint ventures (Joint Ventures) with BIL have been included
as subsidiary undertakings. As a result of the DLC arrangements, the Joint
Ventures are managed on a unified basis and are therefore deemed to be
subsidiary undertakings of BIP. The interests of BIL in the Joint Ventures have
been recognised as minority interests.


2       Accounting policies
---------------------------

The financial information for the year ended 30 June 2005 has been prepared on
the basis of the accounting policies set out in the 2004 Annual Review.


3       Combined financial information
--------------------------------------

The combined financial information presented on pages 16 to 33 forms part of the
notes to the financial information for BIP. The DLC structure unites the
economic interests of BIP and BIL shareholder groups. The Directors consider
that to provide a true and fair view of the impact of the DLC arrangements on
BIP it is necessary to provide combined financial information of the combined
businesses of BIP and BIL under merger accounting principles.


4       Status of financial information
---------------------------------------

The preliminary results for 2005 were approved by the board of Directors on 24
August 2005. The financial information contained in this announcement does not
constitute statutory financial statements within the meaning of section 240 of
the Companies Act 1985. The financial statements for 2005 will be distributed to
shareholders prior to the Annual General Meeting and filed with the Registrar of
Companies following the AGM. The financial statements for 2005 include the
auditors' report, which was unqualified and did not contain a statement under
section 237 of the Companies Act 1985.

The figures for 2004 have been extracted from the statutory accounts, which have
been distributed to shareholders and filed with the Registrar of Companies. The
auditors' opinion on those accounts was unqualified and did not contain a
statement under section 237 of the Companies Act 1985.


                                        37





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