Marks and Spencer 2003 Annual Report Download - page 33

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www.marksandspencer.co m 31
2. Segmental information
A Classes of business
The Group has two classes of business: Retailing and Financial Services.
Turnover Operating profit Operating assets
2003 2002 2003 2002 2003 2002
£m £m £m £m £m £m
Continuing operations:
Retailing activities 7,747.3 7,268.6 631.5 538.5 3,555.2 3,565.0
Before exceptional operating charges 675.4 538.5
Exceptional operating charges (43.9) –
Financial Services1,2 329.9 350.8 86.4 84.2 648.7 576.7
Total continuing operations 8,077.2 7,619.4 717.9 622.7 4,203.9 4,141.7
Discontinued operations– retailing activities –516.0 –14.7 (36.6) (60.4)
Total operating activities 8,077.2 8,135.4 717.9 637.4 4,167.3 4,081.3
Add: excess interest charged to cost of sales
of Financial Services2–6.4
Total operating profit 717.9 643.8 4,167.3 4,081.3
Profit on sale of property and other fixed assets 1.6 41.2
Net loss on sale/termination of operations (1.5) (366.7)
Net interest (expense)/income (40.5) 17.6
Profit on ordinary activities before taxation 677.5 335.9 4,167.3 4,081.3
Unallocated net liabilities (1,128.9) (1,000.0)
Net assets 3,038.4 3,081.3
B Geographical split
The geographical segments disclose turnover and operating profit by destination and reflect management responsibility.
Turnover Operating profit Operating assets
2003 2002 2003 2002 2003 2002
£m £m £m £m £m £m
United Kingdom
Retail 7,066.0 6,575.2 588.0 505.2 3,438.1 3,445.6
Before exceptional operating charges 631.9 505.2
Exceptional operating charges (43.9) –
Financial Services1,2 329.9 350.8 86.4 84.2 648.7 576.7
7,395.9 6,926.0 674.4 589.4 4,086.8 4,022.3
International Retail 681.3 693.4 43.5 33.3 117.1 119.4
Total continuing operations 8,077.2 7,619.4 717.9 622.7 4,203.9 4,141.7
Discontinued operations– International –516.0 –14.7 (36.6) (60.4)
Total operating activities 8,077.2 8,135.4 717.9 637.4 4,167.3 4,081.3
Add: excess interest charged to cost of sales
of Financial Services2–6.4
Total operating profit 717.9 643.8
1Operating profit for Financial Services includes £14.1m of merchant fee income (last year £15.0m) arising on Marks & Spencer Chargecard
transactions. This fee is payable by UK Retail and has been deducted in arriving at UK Retail operating profit.
2Financial Services operating profit is stated after charging £85.7m (last year £103.7m) of interest to cost of sales. This interest represents the cost
of funding the Financial Services business as a separate segment, including both intra-group interest and third party funding. The amount of
third party interest payable by the Group amounted to £137.0m (last year £116.9m) (see note 5). Intra-group interest of £nil (last year £6.4m),
being the excess over third party interest payable, has been added back in the segmental analysis to arrive at total operating profit.
3UK Retail turnover including VAT comprises clothing, footwear and gifts £4,149.1m (last year £3,773.4m); home £403.2m (last year £373.3m) and
foods £3,252.7m (last year £3,093.5m). VAT on UK Retail turnover was £739.0m (last year £665.0m).
4Turnover from continuing operations originates in the following geographical segments: United Kingdom £7,539.4m (last year £7,055.9m) and
International £537.8m (last year £563.5m).
5The value of goods exported from the UK, including shipments to international subsidiaries, amounted to £271.6m (last year £329.8m).