Marks and Spencer 2012 Annual Report Download - page 106

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Financial statements Marks and Spencer Group plc Annual report and financial statements 2012 104
Notes to the financial statements continued
25 Contingencies and commitments
A. Capital commitments
2012
£m
2011
£m
Commitments in respect of properties in the course of construction 71.4 90.8
In respect of its interest in a joint venture, the Group is committed to incur capital expenditure of £nil (last year £0.5m).
B. Other material contracts
In the event of a material change in the trading arrangements with certain warehouse operators, the Group has a commitment to
purchase property, plant and equipment, at values ranging from historical net book value to market value, which are currently
owned and operated by the warehouse operators on the Group’s behalf.
See note 12 for details on the partnership arrangement with the Marks & Spencer UK Pension Scheme.
C. Commitments under operating leases
The Group leases various stores, offices, warehouses and equipment under non-cancellable operating lease agreements. The
leases have varying terms, escalation clauses and renewal rights.
2012
£m
2011
£m
Total future minimum rentals payable under non-cancellable operating leases are as follows:
Within one year 257.8 242.6
Later than one year and not later than five years 997.4 923.0
Later than five years and not later than ten years 1,029.5 990.8
Later than ten years and not later than 15 years 772.7 767.4
Later than 15 years and not later than 20 years 385.1 402.9
Later than 20 years and not later than 25 years 259.3 243.1
Later than 25 years 1,210.1 1,210.3
Total 4,911.9 4,780.1
The total future sublease payments to be received are £63.3m (last year £65.8m).
26 Analysis of cash flows given in the statement of cash flows
Cash flows from operating activities
2012
£m
2011
£m
Profit on ordinary activities after taxation 489.6 598.6
Income tax expense 168.4 182.0
Finance costs 136.8 152.9
Finance income (48.3) (96.6)
Operating profit 746.5 836.9
Increase in inventories (0.1) (72.1)
(Increase)/decrease in receivables (17.1) 2.9
Payments to acquire leasehold properties (1.2) (1.4)
Increase in payables 103.4 175.2
Non-underlying operating cash outflows (22.9) (12.3)
Depreciation, amortisation and asset write-offs 479.7 467.5
Share-based payments 32.5 31.7
Pension costs charged against operating profit 57.7 60.0
Cash contributions to pension schemes (89.9) (91.2)
Non-underlying operating profit items (see note 5) 63.5 (12.0)
Cash generated from operations 1,352.1 1,385.2
Non-underlying operating cash outflows primarily relate to the utilisation of the provisions for UK restructuring and strategic
programme costs.