Aer Lingus 2013 Annual Report Download - page 26

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24
Net exceptional items
2013 net exceptional costs were €17.4 million comprising:
€4.3 million relating to restructuring costs including the relocation of Shannon long haul line maintenance to Dublin, the conclusion of
the Greenfield programme, outsourcing of the Group’s HR function and other restructuring activity
€8.9 million in respect of payments to 124 staff exiting the Company under the 2013 VSP. 119 staff had left as at 31 December 2013
with a further 5 staff committed to exit in 2014
€6.1 million of professional and legal fees. These fees relate to bid defence costs associated with Ryanair’s third takeover for Aer
Lingus (which was launched in 2012 but concluded in 2013 with the announcement by the European Commission of its prohibition
decision) and advisor fees and other expenses related to the ongoing efforts to place the provision of pension benefits in Aer Lingus on a
sustainable basis
The above amounts were offset by a gain of €1.9 million representing the profit on the sale of a spare engine net of a loss on disposal of
other assets.
Refer to Note 9 in the financial statements for more detail.
Finance income and expense
Net finance expense for 2013 was €4.2 million (2012: expense of €2.0 million). Finance expense of €15.1 million decreased by €1.6 million
due to declining finance lease obligations as scheduled debt repayments continued during the year. Interest rates applicable to finance leases
remained static in the year. Finance income of €10.8 million decreased by €3.9 million mainly reflecting the impact of lower deposit interest
rates and a lower average level of gross cash held. Interest expense on post employment benefit obligations is included within finance
expense and has remained relatively static year-on-year. The net interest charge on post employment benefit obligations reflects the change
in basis of calculation arising from the adoption of IAS 19R from 1 January 2013 (see basis of preparation Note – 2.1). The comparative has
been restated to reflect this impact.
€ million
2013
2012
(as restated)
% Increase/
(decrease)
Finance income
10.8
14.7
(26.5%)
Finance expense
(15.1)
(16.7)
(9.6%)
Net finance expense
(4.2)
(2.0)
(110% )
Average gross cash
964.6
996.8
(3.2%)
Average gross debt
510.5
560.7
(9.0%)
Average interest rate:
Deposit
Debt
1.0%
2.5%
1.4%
2.5%
(0.4 pts)
0.0 pts
Tax charge
The total tax charge in the current year of €5.4 million primarily relates to movements in deferred tax with minimal cash taxes payable. The
effective rate of 13.8% is influenced by permanent disallowable items.
€ million
2013
2012
Total tax charge
5.4
6.5
Effective tax rate
13.8%
16.1%
Carried forward tax losses
419.2
438.2
Cash flow, cash and debt
€ million
2013
2012
Gross cash
897.4
908.5
Gross debt
(477.6)
(531.6 )
Net cash
419.8
376.9