Marks and Spencer 2010 Annual Report Download - page 115

Directors’ report p01 
Financial statements 
Other information p117 
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29 Analysis of net debt continued
B. Reconciliation of net debt to statement of financial position
2010
£m
2009
£m
Statement of financial position and related notes
Cash and cash equivalents 405.8 422.9
Current financial assets (see note 17) 171.7 53.1
Bank loans and overdrafts (see note 21) (267.4) (159.1)
Syndicated bank facility (see note 21) (219.8) (781.2)
Medium-term notes (see note 21) – net of hedging derivatives (2,048.2) (1,848.1)
Finance lease liabilities (see note 21) (89.8) (101.9)
Partnership liability to the Marks & Spencer UK Pension Scheme (see note 21) (71.9) (139.9)
(2,119.6) (2,554.2)
Interest payable included within related borrowing 51.2 63.4
Total net debt (2,068.4) (2,490.8)
30 Related party transactions
A. Subsidiaries
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not
disclosed in this note. Transactions between the Company and its subsidiaries are disclosed in the Company’s separate financial statements.
B. Hedge End joint venture
A loan of £5.0m was received from the joint venture on 9 October 2002. It is repayable on five business days’ notice and was renewed on
1 January 2010. Interest was charged on the loan at 2.0% until 31 December 2009 and 0.5% thereafter.
C. Lima (Bradford) joint venture
A loan facility was provided to the joint venture on 11 August 2008. At 3 April 2010, £25.4m (last year £13.6m) was drawn down on this
facility. Interest was charged on the loan at 1.1% above 3-month LIBOR.
D. Marks & Spencer Pension Scheme
Details of other transactions and balances held with the Marks & Spencer Pension Scheme are set out in notes 11 and 21.
E. Key management compensation
2010
£m
2009
£m
Salaries and short-term benefits 9.6 6.0
Termination benefits 0.2 1.1
Share-based payments 3.1 1.8
Total 12.9 8.9
Key management is comprised of Board directors only. Further information about the remuneration of individual directors is provided in
the Remuneration report. During the year, key management have purchased goods at the Group’s usual prices less a 20% discount.
This discount is available to all staff employed directly by the Group in the UK.
F. Other related party transactions
Supplier transactions occurred during the year between the Group and a company controlled by a close family member of Kate Bostock,
an executive director of the Group. These transactions amounted to £6.5m during the year (last year £5.2m) with an outstanding trade
payable of £0.4m at 3 April 2010 (last year £nil). The company was a supplier prior to Kate’s employment by the Group.
Supplier transactions occurred during the year between the Group and a company controlled by Martha Lane Fox’s partner. Martha is a
non-executive director of the Group. These transactions amounted to £1.7m during the year (last year £0.1m) with an outstanding trade
payable of £0.8m at 3 April 2010 (last year £nil).
31 Subsequent events
On 12 May 2010, Marks and Spencer Group plc announced a £800m funding plan for its UK Defined Benefit Pension Scheme.
The funding plan includes the following contributions from Marks Spencer:
– cash contributions of £35m per annum for the first three years of the funding plan increasing to £60m per annum until 2018. This has
a present day cash value of £376m.
– £300m of value through the granting of a further interest in the Marks and Spencer Scottish Limited Partnership. This new interest entitles
the Pension Scheme to a fixed annual distribution of c. £36m for 15 years commencing in 2017 and a capital sum in 2031 equal to the
lower of £350m or any funding deficit in the Pension Scheme at that point in time.
– £124m of value through the transfer of assets from existing US$ debt hedge contracts held by Marks and Spencer plc.
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