BT 2003 Annual Report Download - page 111

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28. Reconciliation of movement in shareholders’ funds
Share
capital
£m
Share
premium
account
£m
Other
reserves
£m
Profit
and loss
account
£m
Total
£m
Balances at 1 April 2000 7,485 – (3,345) 9,700 13,840
Employee share option schemes – 78 million
shares issued (note 34) 88 – 546 – 634
Movement relating to BT’s employee share ownership trust
a
–––(359) (359)
Currency movements (including £65 million net
movements in respect of foreign currency borrowings)
b
–––429429
Loss for the financial year – – – (1,870) (1,870)
Dividend (7.8p per ordinary share) – – – (571) (571)
Adjustment to unrealised gain on transfer of assets
and group undertakings to a joint venture – – (49) – (49)
Balances at 1 April 2001 7,573 – (2,848) 7,329 12,054
Rights issue
c
2,272 – 3,604 – 5,876
Shares issued to special purpose trust
d
65 – 108 – 173
Other allotments of ordinary shares prior to
demerger – 52 million shares issued 61 – 160 – 221
Distribution relating to demerger of mmO
2e
–––(19,490) (19,490)
Capital reduction on 21 November 2001
f
(9,537) – – 9,537 –
Goodwill, previously written off to reserves, taken
back to the profit and loss account
g
(note 7) –––6868
Employee share option schemes – 1 million
shares issued (note 34) –2––2
Movement relating to BT’s employee share ownership trust
a
–––(70) (70)
Unrealised gain on start up of joint ventures – – 5 – 5
Realisation of gain made on start up of joint ventures – – (2) – (2)
Movement in other reserves due to demerger – – (2) – (2)
Currency movements (including £36 million net
movements in respect of foreign currency borrowings)
b
–––(15) (15)
Profit for the financial year – – – 995 995
Dividend (2.0p per ordinary share) – – – (173) (173)
Balances at 1 April 2002 434 2 1,025 (1,819) (358)
Goodwill, previously written off to reserves, taken
back to the profit and loss account
g
(note 7) –––869869
Employee share option schemes – 0.2 million shares issued (note 34) –––––
Transfer between reserves
h
––(27) 27 –
Currency movements (including £106 million net movements in respect of
foreign currency borrowings)
b
–––55
Profit for the year – – – 2,686 2,686
Dividend (6.5p per ordinary share) – – – (560) (560)
Balances at 31 March 2003 434 2 998 1,208 2,642
a
During the year ended 31 March 2002 the company issued shares at a market value of £154 million (2001 – £400 million) in respect of the exercise
of options awarded under its principal savings-related share option scheme. Employees paid £84 million (2001 – £145 million) to the group for the issue
of these shares and the balance of £70 million (2001 – £255 million) comprised contributions to the qualifying employee share ownership trust from group
undertakings. The movement relating to BT’s Employee Share Ownership Trust in 2001 included the writedown of shares held in trust.
b
The cumulative foreign currency translation adjustment, which increased retained earnings at 31 March 2003, was £222 million (2002 – £217 million,
2001 – £278 million).
c
The group’s rights issue closed on 15 June 2001, when British Telecommunications plc was the parent company of the group. A total of 1,976 million
ordinary shares of 25p each was issued at 300p per share in a 3 for 10 rights issue. Of the total of £5,876 million raised, net of £52 million expenses,
£494 million was credited to share capital and £5,382 million to the share premium account of British Telecommunications plc. Following the introduction
of BT Group plc as the parent company of the group, the increase in consolidated share capital has been restated to reflect the nominal value of BT Group
plc shares and the balance has been credited to other reserves.
d
In connection with outstanding share options at the date of demerger, 57 million British Telecommunications plc ordinary shares were issued on
14 November 2001 to a special purpose trust. Of the consideration of £173 million, £159 million was credited to the share premium account of British
Telecommunications plc. Following the introduction of BT Group plc as the parent company of the group, the increase in consolidated share capital has
been restated to reflect the nominal value of BT Group plc shares and the balance has been credited to other reserves.
e
The demerger distribution of £19,490 million represents the net assets of mmO
2
, including purchased goodwill, as at the date of the demerger. See also
the note on the face of the group profit and loss account for the year ended 31 March 2002.
f
Following the approval of the Court, the nominal value of BT Group shares was reduced from 115p per share to 5p per share on 21 November 2001 by
way of a reduction of capital under section 135 of the Companies Act 1985. The surplus of £9,537 million arising from this reduction has been credited
to group profit and loss reserve.
g
Aggregate goodwill at 31 March 2003 in respect of acquisitions completed prior to 1 April 1998 of £385 million (2002 – £1,254 million,
2001 – £1,383 million) has been written off against retained earnings in accordance with the group’s accounting policy. The goodwill written off against
retained earnings will be charged in the profit and loss account on the subsequent disposal of the business to which it related.
h
Release of statutory reserves in subsidiary undertakings on cessation of associated activities.
Notes to the financial statements
110 BT Annual Report and Form 20-F 2003