Marks and Spencer 2006 Annual Report Download

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Annual report
and financial statements
2006

Table of contents

  • Page 1
    Annual report and financial statements 2006

  • Page 2
    ...EACH WEEK. We offer stylish, high quality, great value clothing and home products, as well as outstanding quality foods, all responsibly sourced from suppliers we trust. We employ 65,000 people and have over 450 UK stores, as well as a flourishing international business. 03 Chief Executive's review...

  • Page 3
    ... we will be sharing our success with all employees at every level in the Group next month. Our reward scheme this year includes a one-off discretionary bonus for our customer assistants of up to £500 each. Chairing any major public company is an honour, but chairing M&S is a special privilege. Few...

  • Page 4
    ... new Chairman after the meeting. I know that he will provide the Board with effective leadership. Terry brings to the task skills Marks and Spencer Group plc honed in a successful career in academia, the Civil Service and, latterly, business, including his Chairmanship of Abbey National. The plan...

  • Page 5
    ...10% through a continued tight control of costs, tight management of stock commitments and better buying. Group profit before tax, exceptional items and asset disposals rose 35.1% to £751.4m (last year £556.1m). Total UK retail sales were up 3.4% at £7.3bn, as Food recorded strong growth of 7% and...

  • Page 6
    ... and designers are trained in our Buying Academy to make sure they Best 17% We have restructured our prices, so that our customers get clear choices and great value right across our ranges. 31% of our products are now at opening price points, including £1-per-pair socks and £5 t-shirts.

  • Page 7
    ...we meet in our stores. We have used counters in over 160 stores to improve the way we measure customer visits and are trialling new software to analyse conversion - the number of customers who make a purchase when they visit - allowing us to plan better service levels for busy times. Customer visits...

  • Page 8
    ... brighter with better layout, equipment, changing rooms, service areas and cafés. This level of investment is expected to continue into 2007/08. We now have a design which works well and are seeking to roll it out at lower cost. This major project is being carefully managed, with stores being kept...

  • Page 9
    ... year. 56,000 employees underwent 'Our Service Style' customer service training in 2005/06. 35 % of our store portfolio, equating to 5 million sq ft of space, will be refurbished by the end of 2006/07. UK STORES Scotland 35 Northern Ireland 10 Wales 18 England 388 STORE TYPE NUMBER OF STORES...

  • Page 10
    Operating review Clothing and Home This year, we offered customers a much better choice of stylish and fashionable products at outstanding value and our sales improved as a result.

  • Page 11
    ... business continued with its clear strategy of great value and simpler but stylish ranges with mainstream appeal, supported by a much better catalogue and CLASSIC COLLECTION We now use focus groups to ensure the changes we make hit the mark with customers. In 2005/06, our 'Classic Collection' team...

  • Page 12
    .... One of the first signs of change was the new fashion range, 'Girls Boutique' for 7-14 year olds, which had a good first season. Outstanding value across our ranges Offering customers outstanding value - great quality at great prices - at all points across our price hierarchy continued to be a key...

  • Page 13
    ..., great value Home products through our website and improved catalogue, to build further on the progress made during 2005/06. FAST FASHION In November 2005, the Womenswear team, our new Turkish office and local suppliers worked together to design, buy and deliver a fast-fashion 'Limited Collection...

  • Page 14
    Operating review Food Our food business enjoyed a very successful year. Strong product development, new advertising, improved Food Halls and the performance of 'Simply Food' all helped drive sales.

  • Page 15
    ... of our buying teams, our food technologists and our suppliers. In recent years, we have chased too wide a range of initiatives, often done on too small a scale to have real impact. We have since refined our product strategy, concentrating on four main areas - fresh, natural, healthy food; special...

  • Page 16
    ... customers Our 'Simply Food' stores continue to reach new customers who like the convenience offered by locations such as railway stations and motorway service areas. The 'Marks & Spencer Cook!' range is designed for the busy person who doesn't always have the time or expertise to cook great food...

  • Page 17
    ... significant capital cost. By continuing to work with trusted partners, we benefit from both their local knowledge and increased economies of scale. Wholly-owned We have eight wholly-owned stores in Hong Kong and this continues to be an attractive and profitable market for us. Competition for good...

  • Page 18
    ... and continuing to open new stores in key locations. SIMPLY FOOD TO THE FORE Our biggest tangible asset is our store portfolio. It is also the way that our customers experience our brand. Our stores are in great locations, but they have been subject to underinvestment in past years. We have embarked...

  • Page 19
    ...service training during the year. One in six of our customer assistants has been trained as a Coach, responsible for training new staff and upskilling colleagues. Our 8,000 Coaches are critical in ensuring product knowledge, work methods and customer service are at the highest levels. In head office...

  • Page 20
    ... Social Responsibility Report which is available to download from our website www.marksandspencer.com/csrreport2006. We also continued to support the communities in which we operate and invested a total of £9.3m, in cash and in kind, in community initiatives. Through 'Marks & Start', the biggest...

  • Page 21
    ... Holdings Limited; Guardian Media Group plc; The Low Pay Commission; and the Trustees of Tate. He is a non-executive director of the Bank of New York and a member of the Court of Directors of the Bank of England. STEVEN SHARP EXECUTIVE DIRECTOR MARKETING, E-COMMERCE, STORE DESIGN AND DEVELOPMENT...

  • Page 22
    .../financialreview2006 Marks and Spencer Group plc Financial review Group summary Summary of results Continuing operations before exceptional items and asset disposals Revenue Operating profit Net interest payable Other finance income Profit before tax, exceptional items and asset disposals Loss on...

  • Page 23
    ...Operating profit 2005/06 In Clothing, better values, better buying, and better styling resulted in better performance as the year progressed with sales up 4.4% in the second half. Womenswear benefited from well-received ranges, including more frequent additions of new product into stores. 'Per una...

  • Page 24
    ... store in the pipeline, continues to perform well, although the results for the year were impacted by the cost of opening new stores. Like-for-like results in Hong Kong were good but the overall result was affected by the loss of the Pacific Place store and the relocation of the Times Square store...

  • Page 25
    Marks and Spencer Group plc 23 Shareholder returns and dividends Adjusted earnings per share from continuing operations, which excludes the effect of exceptional items and asset disposals, has increased by 63.5% to 31.4p per share. The dividend charge for the year of £204.1m (last year £236.9m) ...

  • Page 26
    ... tangible non-current assets of £326.8m (last year £218.5m). The major components are analysed in the chart below: Capital expenditure Free cash flow was £701.8m compared to £1,205.9m last year. After taking into account the proceeds from the issue of new shares, the payment of dividends and...

  • Page 27
    ... payments were in addition to annual service contributions at a level of 15.8% of pensionable salaries. As at 1 April 2006, the IAS 19 deficit for the UK defined benefit scheme was £775m. The amount of the deficit is sensitive to changes in the main financial assumptions, particularly the rate used...

  • Page 28
    ... Group plc Group directors' report Principal activities and business review Marks and Spencer Group plc is the holding company of the Marks & Spencer group of companies (the "Group"). We are one of the UK's leading retailers of clothing, food and home products. We also trade in wholly-owned stores...

  • Page 29
    ...of substantial shareholdings showed the following interests in 3% or more of the Company's shares: Ordinary shares % share capital Brandes Investment Partners, LLC Legal & General Investment Management Fidelity International 199,889,342 55,032,628 50,690,284 11.88 3.20 3.01 Board of directors On...

  • Page 30
    28 Marks and Spencer Group plc Group directors' report continued Directors' interests The beneficial interests of the directors and connected persons in the shares of the Company are shown below. Options granted under the Save As You Earn Share Option and Executive Share Option Schemes are shown ...

  • Page 31
    ... informed of the performance and objectives of the Group through personal briefings, regular meetings and email. These are supplemented by our employee publication, and video presentations. Business Involvement Groups in stores, and head office locations represent employees in two-way communication...

  • Page 32
    ... employees fulfilling public duties and support for bodies representing the business community in policy review or reform. To enable the Company and its principal employing companies, (Marks and Spencer plc, Marks & Spencer Outlet Limited, Marks and Spencer Shared Services Limited, Marks and Spencer...

  • Page 33
    ... Spencer Group plc 31 This authority expires in 2010 as permitted by the legislation. The policy of not making Donations to any EU Political Organisation will continue. However, should the Board wish to change this policy during the term of this authority, the Company will seek renewed shareholder...

  • Page 34
    ... the Board and management run the business for the benefit of shareholders. A detailed account of how we comply with the Combined Code on Corporate Governance (the 'Code') provisions can be found on the Company's website, together with the terms of reference of the Audit, Remuneration and Nomination...

  • Page 35
    .... Items reviewed during the year include: General Merchandise stock commitment controls, Food new product development process, business continuity planning and controls over advertising expenditures and payroll. Whistleblowing procedures were reviewed and updated and a new Code of Ethics policy was...

  • Page 36
    34 Marks and Spencer Group plc Corporate governance continued Board the remuneration strategy and framework, giving due regard to the financial and commercial health of the Company and to ensure the executive directors and senior management are fairly rewarded for their individual contributions to...

  • Page 37
    ... The collective performance of the Board and its committees has been reviewed through a combination of questionnaire responses, individual discussions and Board meetings to review findings. Progress has been tracked during the year against an agreed action plan. In March 2005 the Chairman consulted...

  • Page 38
    ...date of approval of the Annual report and accounts. It has been regularly reviewed by the Board and accords with the Internal Control Guidance for directors on the Code produced by the Financial Reporting Council. • Opportunities are provided for the non-executive and executive directors to meet...

  • Page 39
    ... 'Eat Well' and Fairtrade tea and coffee • Competitive pay and performance related bonus • Career progression for customer assistants, section and store managers • Customer service training - 'Our Service Style' • Buying Academy in head office • Business Involvement Group (BIG) - employee...

  • Page 40
    38 Marks and Spencer Group plc Corporate governance continued Internal control The Board maintains full control and direction over appropriate strategic, financial, organisational and compliance issues. It has delegated to executive management the implementation of the systems of internal control ...

  • Page 41
    ... employees with an appointment date prior to 1 April 2002 and a defined contribution scheme open to those joining the Company on or after 1 April 2002. More information is given in the Remuneration Report on page 43 and note 11 to the Accounts. The Board of the Pension Trust (Trustee Board) manages...

  • Page 42
    ... package is designed to support the Company's strategy and drive continuous and sustainable improvement in shareholder value. Total remuneration for executive directors comprises salary, variable pay, pension and benefits. Salary and benefits are set having regard to market practice and levels paid...

  • Page 43
    ... reviewing salaries such as Company performance, level of salaries for large retailers and for other major FTSE 100 companies, market conditions, the level of increase awarded to employees throughout the business and the responsibilities of individual directors. Current annual salaries for executive...

  • Page 44
    42 Marks and Spencer Group plc Remuneration report continued Long-term Incentive Schemes Performance Share Plan The Performance Share Plan is the primary form of long-term incentive for the top 100 senior management. Under the plan, annual awards of up to 200% of salary may be offered based on ...

  • Page 45
    ...this report. A SAYE Option Scheme was approved by shareholders in 1981 and renewed by shareholders in 1987 and 1997. HMRC rules limit the maximum amount saved to £250 per month. When the savings contract is started, options are granted to acquire the number of shares that the total savings will buy...

  • Page 46
    ... Marks and Spencer Group plc Remuneration report continued External appointments The Company recognises that executive directors may be invited to become non-executive directors of other companies and that such appointments can broaden their knowledge and experience, to the benefit of the Company...

  • Page 47
    Marks and Spencer Group plc 45 PART 2: AUDITED INFORMATION 1 Directors' emoluments Current annual salary/fee £000 Salary/fee £000 Benefits £000 Bonus £000 Termination payments £000 Total 2006 £000 Total 2005 £000 Chairman Paul Myners1 Chief Executive Stuart Rose2, 7 Executive ...

  • Page 48
    ...Marks and Spencer Group plc Remuneration report continued 2 Directors' interests in long-term incentive schemes Performance Share Plan Maximum receivable at 2 April 2005 or date of appointment Awarded in year Vested in year Lapsed in year Maximum receivable at 1 April 2006 or date of leaving1 Date...

  • Page 49
    ...director level. Awards under the plan are made as part of ongoing reviews of reward packages, and recruitment tools for new employees. The shares are held in trust for a period of between one and three years, at which point they are released to the employee, subject to them still being in employment...

  • Page 50
    ... Retirement Plan was withdrawn but payments continue for awards made before this date. The pension scheme entitlement for Clinton Silver is supplemented by an additional, unfunded pension paid by the Company. 2 Approved by the Board Jack Keenan, Chairman of the Remuneration Committee London 26...

  • Page 51
    ... expense, the Company statement of changes in shareholders' equity and the related group and parent Company notes. These financial statements have been prepared under the accounting policies set out therein. We have also audited the information in the Directors' Remuneration Report that is described...

  • Page 52
    ...on defined benefit pension schemes Tax on items taken directly to equity Hedging reserve - fair value movement - recycled and reported in net profit - amount recognised in inventories Net losses not recognised in the income statement Total recognised income and expense for the year Effect of changes...

  • Page 53
    ... Net assets EQUITY Called up share capital - equity Called up share capital - non-equity Share premium account Capital redemption reserve Hedging reserve Other reserves Retained earnings Total equity Approved by the Board 26 May 2006 Stuart Rose, Chief Executive Ian Dyson, Group Finance Director 13...

  • Page 54
    52 Marks and Spencer Group plc Consolidated cash flow information CASH FLOW STATEMENT Notes 52 weeks ended 1 April 2006 £m 52 weeks ended 2 April 2005 £m Cash flows from operating activities Cash generated from operations - continuing Cash generated from operations - discontinued Tax paid Net ...

  • Page 55
    ... Company's shareholders. Interim dividends are recorded in the period in which they are approved and paid. Pensions Funded pension plans are in place for the Group's UK employees and the majority of employees overseas. The assets of these pension plans are managed by third-party investment managers...

  • Page 56
    54 Marks and Spencer Group plc Notes to the financial statements continued 1 ACCOUNTING POLICIES continued of providing retirement benefits to employees during the year, together with the cost of any benefits relating to past service, is charged to operating profit in the year. A credit ...

  • Page 57
    .... Inventories Inventories are valued at the lower of cost and net realisable value using the retail method. All inventories are finished goods. Foreign Currencies The results of overseas subsidiaries are translated at the weighted average of monthly exchange rates for sales and profits. The balance...

  • Page 58
    ... Marks and Spencer Group plc Notes to the financial statements continued 1 ACCOUNTING POLICIES continued D Non-equity shares Under IAS 32, the Group's non-equity B shares in the Group are held as a current liability and the dividend paid is included within the interest charge for the year. E Bank...

  • Page 59
    ...from year to year again creating volatility in reported earnings. • Policies relating to UK GAAP comparatives Derivative financial instruments The Group uses derivative financial instruments to manage its exposures to fluctuations in foreign currency exchange rates and interest rates. Derivative...

  • Page 60
    ... £324.4m (last year £281.6m). The value of goods exported from the UK, including shipments to international subsidiaries, amounted to £367.6m (last year £319.9m). The Group completed the sale of Marks and Spencer Retail Financial Services Holdings Limited to HSBC Holdings plc on 9 November 2004...

  • Page 61
    Marks and Spencer Group plc 59 3 EXPENSE ANALYSIS 2006 Before exceptional Exceptional items items £m £m Before exceptional items £m Exceptional items £m 2005 Total £m Total £m Revenue Cost of sales Gross profit Selling and marketing expenses Administrative expenses Other operating income ...

  • Page 62
    60 Marks and Spencer Group plc Notes to the financial statements continued 4 PROFIT BEFORE TAXATION The following items have been included in arriving at profit before taxation: Depreciation of property, plant, and equipment: - Owned assets - Under finance leases Amortisation of intangibles (...

  • Page 63
    ... rate derivative. The fair values of these derivatives have been reported as a net figure under interest income. 6 INCOME TAX EXPENSE A Taxation charge 2006 £m 2005 £m Current tax UK corporation tax at 30% (last year 30%) - current year - prior years Overseas current taxation Total current...

  • Page 64
    ... Spencer Group plc Notes to the financial statements continued 6 INCOME TAX EXPENSE continued B Taxation reconciliation 2006 £m 2005 £m Profit before tax Taxation at the standard UK corporation tax rate of 30% (last year 30%) Depreciation and charges on non-qualifying fixed assets Share schemes...

  • Page 65
    ... shares being those share options granted to employees where the exercise price is less than the average market price of the Company's ordinary shares during the year. Details of the adjusted earnings per share are set out below: 2006 £m 2005 £m Earnings after tax and non-equity dividends Profit...

  • Page 66
    ... remuneration and associated costs of Group employees were: 2006 Continuing operations £m Discontinued operations £m 2005 Continuing Discontinued operations1 operations £m £m Total £m Total £m Wages and salaries Social security costs Other pension costs Share-based payments Employee...

  • Page 67
    ...benefit schemes. The Group's accounting policy for recognising actuarial gains and losses is to recognise these immediately through the statement of recognised income and expense. A Pensions and other post-retirement liabilities 2006 £m 2005 £m Total market value of assets Present value of scheme...

  • Page 68
    ... under the Scheme will be reviewed and the demographic assumptions updated if appropriate. D Analysis of assets and expected rates of return The major categories of assets as a percentage of total plan assets are: 2006 % 2005 % UK equities Overseas equities Government bonds Corporate bonds (Triple...

  • Page 69
    ...year £6.5m). F Scheme assets Changes in the fair value of the scheme assets are as follows: 2006 £m 2005 £m Fair value of scheme assets at start of year Expected return on scheme assets1,2 Employer contributions3,4 Benefits paid Transfer on disposal of Financial Services Actuarial gain Exchange...

  • Page 70
    ... 2005 £m Present value of obligation at start of year Current service cost Curtailment gain Interest cost1 Benefits paid Transfer on disposal of Financial Services Actuarial loss Exchange Discontinued operation Present value of obligation at end of year Analysed as: Present value of pension scheme...

  • Page 71
    ... the terms of the Scheme, the Board may offer options to purchase ordinary shares in the Company once in each financial year to those employees who enter into an Inland Revenue approved Save As You Earn (SAYE) savings contract. Inland Revenue rules limit the maximum amount saved to £250 per month...

  • Page 72
    ... 280p 349p 262p B Executive Share Option Scheme Under the terms of the Executive Share Option Scheme, approved by shareholders in 2005, the Board may offer options to purchase ordinary shares in the Company to executive directors and senior employees at the market price on a date to be determined...

  • Page 73
    Marks and Spencer Group plc 71 12 SHARE-BASED PAYMENTS continued The fair value of executive share options granted during the year is calculated based on a Black-Scholes model assuming the inputs shown below: 2006 2005 2005 Grant date Share price at grant date Exercise price Expected life ...

  • Page 74
    ...-tax value of the invested bonus would be matched by an award of shares, with the extent of the match determined by the Total Shareholder Return performance measure. Further details are set out in the Remuneration report on page 42. No shares have been awarded under the Executive Share Matching Plan...

  • Page 75
    ...beyond this three-year period are extrapolated using a growth rate of 2.0%, which does not exceed the long-term average growth rate for retail businesses in the UK. Management estimates the discount rate using a pre-tax rate that reflects current market assessments of the time value of money and the...

  • Page 76
    74 Marks and Spencer Group plc Notes to the financial statements continued 14 PROPERTY, PLANT AND EQUIPMENT Land and buildings £m Assets Fixtures, in the fittings & course of equipment construction £m £m Total £m At 3 April 2004 Cost Accumulated depreciation Net book value Year ended 2 April...

  • Page 77
    ... 2005 £m At start of year Share of profit At end of year 8.7 0.3 9.0 8.5 0.2 8.7 The joint venture represents a 50% equity interest in Hedge End Park Ltd, a property investment company incorporated in Great Britain. The partner in the joint venture is J Sainsbury plc. In relation to the Group...

  • Page 78
    76 Marks and Spencer Group plc Notes to the financial statements continued 17 OTHER FINANCIAL ASSETS 2006 £m 2005 £m Non-current Unlisted investments Current Listed securities: - Listed in the United Kingdom - Listed overseas Unlisted investments 3.3 0.3 43.6 - 5.2 48.8 51.0 11.4 4.6 67.0 ...

  • Page 79
    ... Hedge End Park Ltd joint venture. Relates to a number of floating rate medium term notes set to mature throughout the 2006/07 financial year linked to sterling and euro LIBOR for periods ranging from one to six months. Relates to three separate bonds securitised against 45 of the Group's properties...

  • Page 80
    ... loan notes Finance leases Non-equity B shares Repayable between one and two years: Medium term notes Securitised loan notes Finance leases Repayable between two and five years: Securitised loan notes Finance leases Repayable in five years or more: Medium term notes Securitised loan notes Finance...

  • Page 81
    ... average time for which the rate is fixed is 10.4 years. Interest rate analysis The effective interest rates at the balance sheet date were as follows: 2006 % Medium term notes Securitised loan notes Non-equity B shares Finance leases Finance leases The minimum lease payments under finance leases...

  • Page 82
    ... to 15 months. As at the balance sheet date the gross value in Sterling terms of forward foreign exchange sell or buy contracts amounted to £270m with a weighted average maturity date of six months. The Group does not use derivatives to hedge balance sheet and profit and loss translation exposures...

  • Page 83
    ... equity are recorded in the income statement in conjunction with the corresponding asset or liability. Forward foreign exchange contracts in relation to the hedging of the Group's foreign currency intercompany loans are designated as held for trading with fair value movements being recognised in the...

  • Page 84
    ...: 2005 £m Current asset investments Cash at bank and in hand Fixed asset investments Other amounts receivable after more than one year Financial assets as defined by FRS 13 67.0 212.6 0.3 4.2 284.1 B Financial liabilities After taking into account the various interest rate and currency swaps...

  • Page 85
    ...-term deposits placed with banks, financial institutions and on money markets, and investments in short-term securities. Therefore, these fair values closely approximate book values. Interest rate, cross currency swaps and forward currency contracts have been marked to market to produce a fair value...

  • Page 86
    84 Marks and Spencer Group plc Notes to the financial statements continued 24 PROVISIONS UK Overseas restructuring restructuring £m £m Total £m At 4 April 2004 Provided in the period Released in the period Utilised during the period Net closure profit in Continental Europe Exchange differences...

  • Page 87
    Marks and Spencer Group plc 85 25 DEFERRED INCOME TAX Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 30% (last year 30%) for UK differences and the local tax rates for overseas differences. The movements in deferred tax assets and ...

  • Page 88
    ... a market value of £15.7m (last year £5.3m). These shares were acquired by the Trust in the market. The Trust used funds provided by Marks and Spencer plc to meet the Group's obligations. Awards are granted to employees at the discretion of Marks and Spencer plc and shares are awarded to employees...

  • Page 89
    ... 60.5 34.5 B Other material contracts: In the event of a material change in the trading arrangements with certain warehouse operators, the Group has a commitment to purchase fixed assets, at values ranging from historical net book value to market value, which are currently owned and operated by...

  • Page 90
    ...) in relation to financing activities and £0.6m outflow (last year £0.5m outflow) for taxation. C Capital expenditure and financial investment Purchase of property, plant and equipment Proceeds from sale of property, plant and equipment Purchase of intangible fixed assets (Purchase)/sale of non...

  • Page 91
    Marks and Spencer Group plc 89 29 ANALYSIS OF CASH FLOWS GIVEN IN THE CASH FLOW STATEMENT continued 52 weeks ended 1 April 2006 £m 52 weeks ended 2 April 2005 £m E Other equity financing Shares issued under employee share schemes Redemption of B shares Net (purchase)/sale of own shares held in ...

  • Page 92
    ...313.6) (50.2) (53.9) (54.7) - (1,775.2) (2,147.7) 21.7 - 24.2 - (1,729.3) (2,147.7) 31 FOREIGN EXCHANGE RATES Weighted average sales rate 2006 2005 Weighted average profit rate 2006 2005 Balance sheet rate 2006 2005 Euro US dollar Hong Kong dollar 1.47 1.78 13.85 1.46 1.85 14.41 1.47 1.79 13.89...

  • Page 93
    ... D Marks & Spencer Pension Scheme Details of other transactions and balances held with the Marks and Spencer Pension Scheme are set out in note 11. E Key management compensation 2006 £m 2005 £m Salaries and short-term benefits Post-employment benefits Termination benefits Share-based payments 12...

  • Page 94
    ...- 'Share Schemes' The Group operates a range of share-based incentive schemes. Under UK GAAP, where shares (or rights to shares) were awarded to employees, UITF 17 required that the charge to the profit and loss account should be based on the difference between the market value of shares at the date...

  • Page 95
    ...under IFRS. Cash flow statement The cash flows reported under IFRS relate to movements in cash and cash equivalents (defined as short-term highly liquid investments that are readily convertible into known amounts of cash and subject to insignificant risk of changes in value). Under UK GAAP, only the...

  • Page 96
    ...£m Effect of IAS 32 and IAS 39 £m Restated opening position at 3 Apr 2005 £m Non-current assets Derivative financial instruments Deferred tax asset Current assets Derivative financial instruments Inventories Current liabilities Derivative financial instruments Borrowings Trade and other payables...

  • Page 97
    ... receivables Total assets LIABILITIES Current liabilities Amounts owed to Group undertakings Current tax liabilities Trade and other payables Non-equity B shares Total liabilities Net assets EQUITY Called up share capital - equity Called up share capital - non-equity Share premium account Capital...

  • Page 98
    96 Marks and Spencer Group plc Company statement of changes in shareholders' equity 52 weeks ended 1 April 2006 £m 52 weeks ended 2 April 2005 £m Profit attributable to shareholders Dividends Shares issued on the exercise of share options Purchase of own shares Tender Offer expenses Redemption ...

  • Page 99
    Marks and Spencer Group plc 97 Company notes to the financial statements C1 ACCOUNTING POLICIES The Company's accounting policies are given in note 1 of the Group financial statements. C2 EMPLOYEES The Company had no employees during the current or prior period. Directors received emoluments in ...

  • Page 100
    ... Company Holding Company Holding Company Retailing Retailing Retailing Retailing Financial Services Finance Finance Finance Finance Finance Property Investment Procurement Procurement Procurement Great Britain Great Britain The Nederlands United States Republic of Ireland United States Hong Kong...

  • Page 101
    Marks and Spencer Group plc 99 C7 STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY continued Ordinary shares £m Share capital Non-equity B shares £m Share premium account £m Capital redemption reserve £m Merger reserve £m Profit and loss account £m Total £m At 3 April 2005 First time adoption ...

  • Page 102
    ... 52 weeks £m IFRS 2005 52 weeks £m UK GAAP 2004 53 weeks £m UK GAAP 2003 52 weeks £m UK GAAP 2002 52 weeks £m Income statement Revenue (excluding sales taxes) Operating profit United Kingdom Overseas Excess interest charged to cost of sales of financial services Total operating profit Analysed...

  • Page 103
    ... UK GAAP 2003 £m UK GAAP 2002 £m Balance sheet Non-current assets Intangible non-current assets Property, plant and equipment (including investment properties) Trade and other receivables Joint ventures and other financial assets Deferred tax asset Non-current assets Current assets Total assets...

  • Page 104
    ... in issue Earnings per share adjusted for exceptional items and asset disposals Dividends per share declared in respect of the year Dividend cover2 Profit attributable to shareholders Dividend payable Profit attributable to shareholders Average equity shareholders' funds Retail debt + net post...

  • Page 105
    ... statement Chairman's statement Charitable donations Chief Executive's review Corporate governance Cost of sales Page 53 33 60 49 85 F Finance leases Financial assets Financial instruments Financial liabilities Financial record Financial review Financial Services Fixed charge cover Foreign exchange...

  • Page 106
    ...Annual report, Annual review and Notice of Meeting are available on our website. You can then read these online instead of receiving copies in the post; check your Marks & Spencer shareholding; access information about your dividends; value your portfolio; change your registered address details; set...

  • Page 107
    ... cheques for payment; and dividend credited to your account on payment date. American Depositary Receipts (ADRs) The Company has a level 1 ADR programme sponsored by JP Morgan Chase Bank NA to enable US investors to purchase Marks & Spencer American Depository Shares (ADS's) in US Dollars 'over the...

  • Page 108
    www.marksandspencer.com