Marks and Spencer 2011 Annual Report Download - page 106

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Marks and Spencer Group plc Annual report and financial statements 2011
104
Notes to the financial statements continued
27 Contingencies and commitments
A. Capital commitments
2011
£m
2010
£m
Commitments in respect of properties in the course of construction 90.8 69.0
In respect of its interest in a joint venture (see note 17), the Group is committed to incur capital expenditure of £0.5m (last year £0.9m).
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 property, plant and equipment, at values ranging from historical net book value to market value, which are currently owned
and operated by them on the Group’s behalf.
See note 12 for details on the partnership arrangement with the Marks & Spencer UK Pension Scheme.
C. Commitments under operating leases
The Group leases various stores, offices, warehouses and equipment under non-cancellable operating lease agreements.
The leases have varying terms, escalation clauses and renewal rights.
2011
£m
2010
£m
Total future minimum rentals payable under non-cancellable operating leases are as follows:
Within one year 242.6 228.2
Later than one year and not later than five years 923.0 815.5
Later than five years and not later than ten years 990.8 824.8
Later than ten years and not later than 15 years 767.4 627.6
Later than 15 years and not later than 20 years 402.9 403.2
Later than 20 years and not later than 25 years 243.1 162.1
Later than 25 years 1,210.3 987.6
Total 4,780.1 4,049.0
The total future sublease payments to be received are £65.8m (last year £51.9m).
28 Analysis of cash flows given in the statement of cash flows
Cash flows from operating activities
52 weeks
ended
2 April
2011
£m
53 weeks
ended
3 April
2010
£m
Profit on ordinary activities after taxation 598.6 523.0
Income tax expense 182.0 179.7
Finance costs 98.6 162.2
Finance income (42.3) (12.9)
Operating profit 836.9 852.0
Increase in inventories (72.1
)
(74.3)
Decrease/(increase) in receivables 2.9 (12.4)
Payments to acquire leasehold properties (1.4) –
Increase in payables 175.2 132.5
Non-underlying operating cash outflows (12.3) (34.1)
Depreciation and amortisation 467.5 427.9
Share-based payments 31.7 28.5
Pension costs charged against operating profit 60.0 57.3
Cash contributions to pension schemes (91.2) (19.6)
Non-underlying operating profit items (see note 5)
(
12.0
)
(8.1)
Cash generated from operations 1,385.2 1,349.7
Non-underlying operating cash outflows primarily relate to the utilisation of the provision for UK restructuring created in 2008/09.