Vodafone 2005 Annual Report Download - page 90

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Notes to the Consolidated Financial Statements continued
88 |Financials
4. Exceptional operating items
2005 2004 2003
£m £m £m
Impairment of intangible and tangible fixed assets (315) –(485)
Contribution tax –351 –
Reorganisation costs –(123) (91)
(315) 228 (576)
The exceptional operating cost of £315 million in the year ended 31 March 2005 is due to an impairment of the carrying value of goodwill relating to Vodafone Sweden.
The net exceptional operating income for 2004 of £228 million comprises £351 million of expected recoveries and provision releases in relation to a contribution tax levy on
Vodafone Italy and reorganisation costs of £123 million primarily relating to the Group’s operations in the UK.
The impairment charges for 2003 of £485 million relate to the carrying value of goodwill for Grupo Iusacell (£80 million) and tangible fixed assets in Japan Telecom (£405
million). Reorganisation costs of £91 million relate to the integration of Vizzavi and related restructuring of the Group’s internet portal activities.
5. Operating loss
2005 2004 2003
Continuing Discontinued Continuing Discontinued
Total(1) operations operations Total operations operations Total
£m £m £m £m £m £m £m
Group turnover 34,133 32,741 818 33,559 28,547 1,828 30,375
Cost of sales (20,753) (18,986) (475) (19,461) (16,910) (986) (17,896)
Exceptional operating items –351 – 351 –––
Other cost of sales (20,753) (19,337) (475) (19,812) (16,910) (986) (17,896)
Gross profit 13,380 13,755 343 14,098 11,637 842 12,479
Selling and distribution costs (2,031) (2,065) (14) (2,079) (1,863) (20) (1,883)
Administrative expenses (16,653) (16,532) (263) (16,795) (14,826) (1,065) (15,891)
Goodwill amortisation (12,929) (13,095) – (13,095) (11,875) – (11,875)
Exceptional operating items (315) (123) –(123) (91) (405) (496)
Other administration expenses (3,409) (3,314) (263) (3,577) (2,860) (660) (3,520)
Total operating expenses (18,684) (18,597) (277) (18,874) (16,689) (1,085) (17,774)
Operating loss (5,304) (4,842) 66 (4,776) (5,052) (243) (5,295)
The results of Japan Telecom are analysed as discontinued operations in prior periods’ analyses.
Note:
(1) The results for the 2005 financial year entirely relate to continuing operations.