RNS Number:5880P
Woolworths Group PLC
10 September 2003
Woolworths Group plc
Interim Results Announcement
For the 26 weeks ended 2 August 2003
Embargoed until 07.00 hrs 10 September 2003
Financial Performance:
* First half losses (before tax, goodwill amortisation and exceptional items)
reduced by 12% to #34.9m (H1 2002: #39.7m)
* Losses before tax reduced by 21% to #36.4m (H1 2002: #46.2m)
* Group sales up by 1.7% to #1,071.5m (H1 2002: #1,053.7m)
* Like-for-like sales at Woolworths Mainchain up by 0.9% and by 1.8% at
Woolworths big W
* Improving trend in Woolworths Mainchain like-for-like sales, with Q2 up
2.5% following a decline in Q1 of 0.4%
* Woolworths gross margin improved by 30 basis points
* 10.8% increase in interim dividend to 0.36p (H1 2002: 0.325p) per share
* Net debt for the period down to #142.9m (H1 2002: #162.6m)
Operational Highlights
* Continued operational improvements: increased availability, reduced
shrinkage and better stock management
* Product development initiatives driving sales and margin
* Early results from trial stores encouraging
* Christmas planning 3 weeks ahead of last year: 6,500 additional staff being
recruited and over 1,000 extra tills installed, two thirds of which will be
hand held terminals
Trevor Bish-Jones, Chief Executive of Woolworths Group plc commented:
" We continue to make progress operationally with better systems, better buying
and cost control underpinning the improved result. Our customers are responding
well to our strategy of making Woolworths famous for "Kids and Celebrations",
with positive early results from our trial stores. Our Christmas plans are well
advanced, with a stronger product offer and promotional platform, supported by a
new advertising campaign. The sales improvement seen in the second quarter has
continued throughout the first 5 weeks of the second half and we look forward to
the all important Christmas period with confidence."
For further information contact:
Christopher Rogers, Finance Director 020 7706 5883
Nicole Lander, Corporate Affairs 020 7706 5653
Alexia Latham, Tulchan Communications 020 7353 4200
Kirstie Hamilton, Tulchan Communications 020 7353 4200
1. Operating Review
This Interim Report presents the results of Woolworths Group plc for the
half-year to 2 August 2003. The results demonstrate further progress by the
Executive Team in implementing the business plan and in getting the business to
perform to its full potential.
The first half loss (before tax, goodwill amortisation and exceptional items)
was #34.9 million compared to #39.7 million last year, an improvement of 12.1
per cent. At Woolworths, losses (before interest, tax, goodwill amortisation and
exceptional items) fell by #2.0 million to #25.3 million and in a challenging
market the Entertainment businesses (Entertainment UK, VCI, MVC and Streets
Online) have performed well, with losses (before interest, tax, goodwill
amortisation and exceptional items) down by #3.1million to #0.6 million.
Total Group sales were up 1.7 per cent on last year, with Woolworths up 1.7 per
cent, and Entertainment up 1.5 per cent. Woolworths sales growth was impacted
by the phasing out of the Woolworths General Stores format which traded for
longer hours. In Entertainment, the sales number reflects the disposal last
year of Disc Distribution which had included turnover from sales made on behalf
of third party labels. Adjusted for these two items, total Group sales were up
4.1 per cent on last year.
Like-for-like sales in Woolworths Mainchain rose 0.9 per cent and in Woolworths
big W by 1.8 per cent, but fell in MVC by 5.6 per cent.
Quarter-on-quarter, Woolworths business performance strengthened, with Mainchain
like-for-like sales recovering from a decline of 0.4 per cent in the first
quarter to an increase of 2.5 per cent in the second quarter and Woolworths big
W similarly improving like-for-like sales from 1.1 per cent to 2.4 per cent.
Better buying, enhanced product development and lower shrinkage helped improve
the gross margin in Woolworths by 30 basis points. Throughout the first half,
costs in our businesses continued to be tightly controlled.
Woolworths
The first half loss (before interest, tax, goodwill amortisation and exceptional
items) from our Woolworths formats has reduced by #2.0 million to #25.3 million.
The focus throughout the period has been on four areas:
Simplifying the Business
During the first half, new processes and clearer reporting lines were introduced
into the commercial function at Woolworths, particularly in the management of
product development, promotion and supply. This has given the organisation a
more effective way of working and has contributed to a reduced headcount within
the Woolworths Head Office, which at the half-year was 7 per cent below the
year-end.
The combining of the MVC and Woolworths Entertainment businesses and the closure
of the MVC head office were completed in April. Removing duplication has
delivered a simpler organisation, better able to drive the development of the
Entertainment offer across all Group formats.
Strengthening the Infrastructure
Progress continues to be made with the systems rollout and the building of an
integrated IT infrastructure for the business.
The rollout of the Kingstore till system continues. At the half-year, the
system was in 264 stores and will be in 318 stores (66 per cent of retail space)
by the year-end. The Kingstore system has speeded up transactions at the till
point, and helped to improve margins through reduced shrinkage and better stock
management.
By the end of September the new Integrated Planning and Replenishment system
(IP+R) will be used to control 90 per cent of store deliveries and 80 per cent
of warehouse intake. This is improving stock control as well as being a
contributory factor to improved availability.
The new range planning tool, Makoro, is now in use in all areas of the business
except Entertainment and Clothing and plans are in place to complete the rollout
over the coming months.
Kingstore, IP+R and Makoro have contributed to a 2.4 percentage points increase
in average instore availability versus the first half last year.
As reported at the year-end, our 2002 supply chain review highlighted the
limitations of the distribution network in meeting the future needs of the
business. This has given rise to a number of initiatives, both short term and
medium term.
Our current warehouse network is not ideally located and is close to reaching
maximum capacity. In addition, reductions in average haulier speeds due to road
congestion, are being compounded by rising fuel costs. To combat these
pressures, from August 2003 the contracted terms of warehouse colleagues have
changed to allow for a seven day working week and we have also introduced out of
hours delivery processes. This will enable the warehousing and distribution
network to operate more efficiently, particularly over the key Christmas period.
For the medium term, we have commenced the process to identify additional
warehouse space to increase the efficiency of product flow from the ports into
our stores. We will continue to enhance our systems infrastructure with an
intake and flow management module, going live in 2004.
Driving margin through product development
It is now a year since we developed a clearer vision of our "core customer".
This lead to the decision to focus Woolworths on being famous for "Kids and
Celebrations" and product that reflects this strategy is now flowing into store,
supporting the growth in sales and margin.
We have seen particularly strong product development in the Toys, Stationery,
Greeting Cards and Home categories which has contributed to growth in both sales
and margin. In Entertainment, and to a lesser extent Clothing, the sales have
been driven by a stronger promotional platform, although in both instances,
margin growth has also been secured.
The product area that remains most challenging is Confectionery. Increased
competition and changing consumer trends require us to develop new lines that
distinguish us from the competition. A new buying team has been recruited and
we are already beginning to see product and promotional innovation returning to
the Woolworths Confectionery offer.
Significant progress has been made in space planning. Space allocation
disciplines at store level are now more rigorously enforced, to ensure greater
consistency, as well as improving margin delivery through better allocation of
space to higher return product areas.
We have reduced the number of promotions the business undertakes with a move
towards fewer, bigger promotions. In some weeks, promotions have fallen by up to
20 per cent and this is having a positive impact on both sales and levels of
residual stocks.
Shrinkage continues to show improvement and remains a priority area. Shrinkage
information at a store or site level is now being routinely used to target
resource into the areas of greatest loss.
Developing Clearer Customer Propositions
Woolworths Mainchain
With an annual turnover of #2.0 billion and over six million customers per week,
our retail profit growth will come from continued operating and product
improvements and a successful refurbishment programme of the Mainchain.
Last year we launched a number of trial stores with enhanced ranges and space
allocation for "Kids and Celebrations".
A new Mainchain store concept, both in terms of design and product range, was
tested in two of our medium to large sized stores and in one small store over
Christmas 2002. The results were sufficiently encouraging in the medium to
large stores, that in May of this year four further stores were refurbished. It
is, of course, far too early in the life cycle of these stores to draw any firm
conclusions, but results so far are encouraging.
An additional four refurbished stores will open in October 2003, making a total
of 10 medium to large new concept stores to trade throughout the Christmas
period.
This will give more insight into the sustainability of the performance
improvements seen so far in these stores.
For smaller stores, a lower cost refit has been developed, which improves the
store environment and adjusts the product mix and space allocation. Thirty two
refitted stores have been trading on this basis since last year and the results
from these smaller stores are also encouraging. A programme to refit a further
32 stores in this financial year is now well underway, with nine stores having
been completed in the first half.
A decision on the next stage of the refurbishment programme for the Mainchain
will be taken in early 2004.
Woolworths big W
The challenge for Woolworths big W during the year is to build both sales and
gross margins. During the first half of the year we have made steady progress.
Like-for-like sales have risen by 1.8 per cent and gross margins have improved
by 30 basis points. During the latter part of the period, revisions to the
advertising and promotional programme coupled with new product ranges have
started to accelerate the sales performance.
A key component of driving margin recovery lies in achieving a higher margin
within the Clothing area. New terms and conditions on product sourced from
Peacocks commenced in August. During the last two weeks of the first half, a
new range of menswear, developed in-house, was successfully launched. The
Christmas trading period is crucial to demonstrating the success and financial
viability of this format.
Entertainment
Sales in the Entertainment businesses (excluding intergroup sales) grew 1.5 per
cent to #219.1 million. Driven by the performance at VCI and the positive
impact from last year's re-organisation of Streets Online, losses (before
interest, tax, goodwill amortisation and exceptional items) for the first half
were reduced by #3.1 million to #0.6 million.
MVC
The integration of MVC with Woolworths, has now been completed. This will
enable expertise to be shared and enhance buying leverage, whilst yielding
annual savings of over #1.5 million.
The first half also saw a reconfiguration of the business to give it a platform
for future growth, although in the short term this has impacted sales, which
were down 5.6 per cent like-for-like. The key changes include:
* A new, more contemporary store environment, with changes to space allocation
to reflect dynamics in the entertainment market and particular emphasis
being given to DVD and games.
* As part of our plans to exploit our substantial customer database, we have
relaunched the MVC card, "More", as a true loyalty card with cardholders
qualifying for additional discounts the more they spend. The card
database, which comprises 2.9 million active customer names, holds full
details of the customer's purchase preference which enables us to target our
marketing more accurately.
* Dual pricing showing a cardholder price and a retail price has been removed.
The business has now moved to a single competitive price.
We believe these changes will give MVC greater focus and clarity and will help
reverse the decline seen in the first half of the year.
Entertainment UK (EUK)
EUK, which is the UK's biggest independent distributor of music, video and games
products, grew its sales by 16 per cent. In a very competitive market, it held
its margin steady but costs rose due to higher levels of customer returns and
greater investment in support for its customers.
A key driver of the growth in EUK is its ability to service a number of sectors
within the Entertainment market. Currently both supermarket and internet
channels are in periods of high growth. EUK gains access to these sectors
through its trading relationships with major participants like Amazon, Tesco and
Safeway. EUK's biggest external customer is Tesco. We are currently in
discussions to renegotiate the Tesco contract, which expires in 2004.
VCI
Sales at VCI fell by 30 per cent to #21.9 million reflecting the sale last year
of its distribution business Disc. Excluding Disc, there was a strong
underlying sales performance with sales up 28.7 per cent. Key videos have
included "Cold Feet" and "Bo' Selecta!," plus "Boohbah," a new children's
programme which has had a very successful launch. In music, Daniel O'Donnell
was a great success reaching No. 3 in the album charts.
2. Borrowings, Stock and Capital Expenditure
The financial disciplines implemented on demerger remain in place. Net debt was
#142.9 million compared to #162.6 million at the end of last year's first half.
Stock at the half-year was #374.9m (H1 2002: #361.4m). This represents a small
increase on last year and is driven by Christmas set up being 3 weeks earlier
and our desire to deliver improved instore availability.
Capital investment in the first half, largely on new systems, trial stores and
further capacity for managing returns at EUK was #23.8 million, compared to
#20.5 million last year.
During the first half our borrowing facilities were renegotiated. This gives us
not only committed funding to 2008, but also improves our cost of borrowing by
50 basis points, with the opportunity for further improvement.
3. Pension Scheme
Following a detailed review we have decided to keep our final salary pension
scheme open to all employees, whilst taking action to reduce the deficit. The
scheme is a valuable recruitment tool and the combination of changes to
contribution rates, retirement age and rates of accrual, mean that the financial
impact for the Company is minimal. The scheme is immature with more than 8,000
active members and fewer than 250 pensioners.
4. Dividends
Based on progress in the first half and our confidence surrounding Christmas we
are increasing the interim dividend by 10.8 per cent to 0.36 pence per share.
This will be paid on 3 December 2003 to shareholders on the register at the
close of business on 19 September 2003.
5. Outlook
These results demonstrate the further progress that is being made across all
areas of the Group. However as always the key trading period will be Christmas.
Our plans are well advanced and build on the progress made last year. The
product offer and promotional platform have been strengthened and will be
supported by a new advertising campaign. We are in the process of recruiting
6,500 extra staff, more than ever before, and store operations will be even
sharper, supported by more robust systems and over 1,000 additional tills - two
thirds of which are hand held terminals. We will enter the Christmas trading
period with confidence.
Group Profit and Loss Account
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
Total Total Total
Note #m #m #m
Turnover - Group and share
of joint ventures
Continuing operations 1,085.3 1,072.8 2,767.1
Less: share of joint ventures' turnover (13.8) (19.1) (49.7)
Group turnover 2 1,071.5 1,053.7 2,717.4
Cost of sales (769.2) (752.4) (1,943.1)
Gross profit 302.3 301.3 774.3
Selling expenses (275.3) (272.1) (582.2)
Administrative expenses (63.6) (75.2) (146.7)
Before exceptional items (63.6) (70.2) (140.4)
Exceptional items 4 - (5.0) (6.3)
Other operating income 4.6 4.0 10.3
Group operating (loss)/profit (32.0) (42.0) 55.7
Continuing operations analysed as:
Before exceptional items (32.0) (37.0) 62.0
Exceptional items - (5.0) (6.3)
Share of operating profit/(loss)
in joint ventures 0.5 0.7 (1.6)
Operating (loss)/profit
including joint ventures (31.5) (41.3) 54.1
Non-operating exceptional items 5 - - (5.5)
(Loss)/profit before interest (31.5) (41.3) 48.6
Net interest payable (4.9) (4.9) (10.6)
(Loss)/profit on ordinary activities
before taxation 6 (36.4) (46.2) 38.0
Taxation 7 12.2 16.7 (12.7)
(Loss)/profit on ordinary activities
after taxation (24.2) (29.5) 25.3
Equity minority interest (0.1) - (0.1)
(Loss)/profit for the financial period (24.3) (29.5) 25.2
Dividends payable to shareholders 8 (5.1) (4.6) (18.7)
Retained (loss)/profit for the financial period (29.4) (34.1) 6.5
(Loss)/earnings per share (pence) 9
Basic (1.7) (2.1) 1.8
Diluted (1.7) (2.1) 1.7
Basic - adjusted* (1.6) (1.7) 2.6
Diluted - adjusted* (1.6) (1.7) 2.5
There is no difference between the reported loss above and the historical cost
equivalent.
* Adjusted earnings per share is calculated before exceptional items and
amortisation of acquisition goodwill.
Group Balance Sheet
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Fixed assets
Intangible assets 61.4 64.6 63.7
Tangible assets 325.3 335.2 332.6
Investments - own shares 4.7 2.8 4.2
- joint ventures - share of gross assets 6.8 9.4 13.6
- share of gross liabilities (6.6) (9.1) (13.4)
391.6 402.9 400.7
Current assets
Stocks 374.9 361.4 348.8
Debtors 139.1 133.4 155.0
Cash at bank and in hand 17.2 14.7 133.8
531.2 509.5 637.6
Creditors due within one year (400.7) (411.9) (477.7)
Net current assets 130.5 97.6 159.9
Total assets less current liabilities 522.1 500.5 560.6
Creditors due after one year (98.3) (97.8) (98.0)
Provisions for liabilities and charges (17.5) (8.4) (27.3)
Net assets 406.3 394.3 435.3
Capital and reserves
Called up share capital 176.1 175.9 176.0
Share premium reserve 0.4 - 0.2
Demerger reserve 24.1 24.1 24.1
Revaluation reserve 3.3 3.3 3.3
Profit and loss account 202.0 190.8 231.4
Equity shareholders' funds 405.9 394.1 435.0
Equity minority interests 0.4 0.2 0.3
406.3 394.3 435.3
Group Cash Flow Statement
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 1 February
2002 2003
Note #m #m #m #m #m #m
Cash flows from
operating activities
(Outflow)/inflow from
ongoing activities 10 (133.4) (157.3) 76.3
Dividends received from
joint ventures 3.7 3.8 4.1
Returns on investments
and servicing of finance
Interest received 0.9 1.5 1.9
Debt issue costs (0.9) - -
Interest paid (5.5) (6.0) (12.3)
(5.5) (4.5) (10.4)
Taxation paid (5.4) (0.6) (2.9)
Capital expenditure
and financial investment
Purchase of intangible fixed assets - - (0.1)
Purchase of tangible fixed assets (23.8) (20.5) (41.9)
Purchase of own shares (0.6) (0.5) (1.9)
Proceeds from sale of tangible
fixed assets 0.1 0.5 0.5
(24.3) (20.5) (43.4)
Acquisitions and disposals
Purchase of subsidiary undertaking - (2.0) (2.5)
Cash acquired with subsidiary - 0.4 0.4
- (1.6) (2.1)
Equity dividends paid (14.1) (12.7) (17.3)
Cash (outflow)/inflow before use of
liquid resources and financing (179.0) (193.4) 4.3
Management of liquid resources
Increase in short-term deposits
with banks - - (2.1)
Financing 10 50.3 (0.1) -
(Decrease)/increase in cash
in the period (128.7) (193.5) 2.2
Notes to the Accounts
1. Basis of preparation
The interim results have been prepared on the basis of the accounting policies
set out in the financial statements for the 52 weeks to 1 February 2003.
2. Segmental Analysis
Turnover
Turnover arises in the UK only and represents retail sales, services supplied
and other income. Turnover excludes Value Added Tax.
The analysis of turnover by destination is not materially different to the
analysis of turnover by origin.
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
(a) Turnover by origin - continuing operations
Woolworths 852.4 837.8 2,158.4
Entertainment 450.5 465.8 1,229.1
Intergroup (231.4) (249.9) (670.1)
Group turnover 1,071.5 1,053.7 2,717.4
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Before Operating Before Operating Before Operating
exceptional exceptional exceptional exceptional exceptional exceptional
items items Total items items Total items costs Total
#m #m #m #m #m #m #m #m #m
(b) (Loss)/profit
before interest
and taxation
Woolworths (25.3) - (25.3) (27.3) (5.0) (32.3) 42.4 (8.8) 33.6
Entertainment (0.6) - (0.6) (3.7) - (3.7) 29.0 (5.6) 23.4
Common (costs)/
income (5.6) - (5.6) (5.3) - (5.3) (11.0) 8.1 (2.9)
Continuing
operations (31.5) - (31.5) (36.3) (5.0) (41.3) 60.4 (6.3) 54.1
Woolworths
non-operating
exceptional
costs - - (5.5)
(Loss)/profit
before interest
and taxation (31.5) (41.3) 48.6
Common costs before exceptional items relate to the Group's Corporate Centre,
amortisation of acquisition goodwill and other consolidation adjustments.
3. (Loss)/Profit After Interest But Before Taxation
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Before Before Before
exceptional Exceptional exceptional Exceptional exceptional Exceptional
items Items Total items items Total items items Total
#m #m #m #m #m #m #m #m #m
(Loss)/profit
before interest
and taxation (31.5) - (31.5) (36.3) (5.0) (41.3) 60.4 (11.8) 48.6
Net interest (4.9) (4.9) (4.9) (4.9) (10.6) (10.6)
payable
(Loss)/profit
after interest
but before
taxation (36.4) - (36.4) (41.2) (5.0) (46.2) 49.8 (11.8) 38.0
4. Operating Exceptional Items
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Restructuring costs - 5.0 13.0
Reversal of provision for
Streets Online Limited - - (6.7)
Total operating exceptional items - 5.0 6.3
Restructuring operating exceptional costs total #nil (26 weeks to 3 August 2002
- #5.0 million with a related tax credit of #1.3 million). The first half 2002
costs represent closure of the Woolworths General Store format (#3.0 million)
and the restructure of the Woolworths Head Office (#2.0 million).
Restructuring costs for the prior year relate to the restructure of central
functions (#4.4 million), the reorganisation of MVC and Streets Online Head
Offices and write-off of certain Streets Online fixed assets (#5.6 million) and
the closure of the Woolworths General Store format (#3.0 million). The related
tax credit on these items amounted to #3.2 million.
5. Non-Operating Exceptional Items
The non-operating exceptional item of #5.5 million (with a tax credit of #nil)
for the 52 weeks to 1 February 2003 relates to the disposal of pharmacy licences
and other store assets as part of the closure of the Woolworths General Store
format.
6. (Loss)/Profit on Ordinary Activities Before Taxation
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
(Loss)/profit on ordinary activities before
taxation is stated after charging:
Operating leases:
Land and buildings 70.2 63.1 140.6
Plant and equipment 2.3 2.0 5.3
Depreciation of tangible fixed assets:
Owned Assets 27.5 28.7 56.1
Loss on the disposal of fixed assets 2.0 0.2 2.0
Net income from property portfolio transactions (3.4) (2.2) (6.0)
Amortisation of acquisition goodwill 1.5 1.5 3.0
Amortisation of other intangible assets 0.7 0.6 1.2
7. Taxation
The Group has a deferred tax asset of #13.4 million (26 weeks to 3 August 2002:
#19.1 million) being recognised on the losses incurred in the year to date. Due
to the seasonality of the business, the Directors believe that this will reverse
by year-end.
8. Dividends Payable to Shareholders
The interim dividend of 0.36 pence (2002: 0.325 pence) per share will be paid on
3 December 2003 to members registered at the close of business on 19 September
2003.
9. Earnings per Share
26 weeks to 26 weeks to 52 weeks to
3 August 2002
2 August 2003 1 February 2003
Weighted average number of shares (millions) 1,394.7 1,399.5 1,398.1
Diluted weighted average number of shares 1,476.9
(millions)
#m #m #m
(Loss)/profit for the financial period (24.3) (29.5) 25.2
Adjustments for exceptional items net of tax - 3.7 8.6
Adjustments for goodwill amortisation 1.5 1.5 3.0
Adjusted (losses)/earnings (22.8) (24.3) 36.8
Basic earnings per share (pence) (1.7) (2.1) 1.8
Diluted earning per share (pence) (1.7) (2.1) 1.7
Basic adjusted earning per share (pence) (1.6) (1.7) 2.6
Diluted adjusted earnings per share (pence) (1.6) (1.7) 2.5
For the two periods above where losses are reported, diluted earnings per share
are equal to the basic earnings per share.
10. Consolidated Cash Flow
a) Reconciliation of Operating (Loss)/Profit to Net Cash Flow from Operating
Activities
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Group operating (loss)/profit (32.0) (42.0) 55.7
Depreciation, amortisation and impairment 29.7 30.8 62.7
Reversal of provision for Streets Online - - (6.7)
Limited
Increase in stocks (26.1) (50.2) (37.6)
Movements in other working capital (107.0) (96.1) 0.2
Loss on disposal of fixed assets 2.0 0.2 2.0
Net cash (outflow)/inflow from operating (133.4) (157.3) 76.3
activities
b) Analysis of Changes in Net Debt
At Non At
2 February 2003 Cash flow Cash items 2 August 2003
#m #m #m #m
Cash and current bank account (net of overdraft) 131.3 (128.7) - 2.6
Deposit with banks 2.1 - - 2.1
133.4 (128.7) - 4.7
Short-term loan notes (0.2) - - (0.2)
Short-term loan - (49.1) - (49.1)
Medium-term loan (98.0) - (0.3) (98.3)
Net cash/(debt) 35.2 (177.8) (0.3) (142.9)
c) Reconciliation of Net Cash Flow to Movement in Net Debt
2003
#m
Decrease in cash in the period (128.7)
Movement in short-term loan (49.1)
Movement in medium-term debt (0.3)
Change in net debt in the period (178.1)
Net cash at 1 February 2003 35.2
Net debt at 2 August 2003 (142.9)
d) Financing
26 weeks to 26 weeks to 52 weeks to
2 August 2003 3 August 2002 1 February 2003
#m #m #m
Movement in short-term loan notes - (0.1) (0.3)
Short-term loan 50.0 - -
Issue of share capital 0.3 - 0.3
Net cash inflow/(outflow) from financing 50.3 (0.1) -
11. Nature of Financial Information
The financial information for the year ended 1 February 2003 has been extracted
from the audited consolidated accounts and does not constitute full accounts
(within the meaning of Section 240 of the Companies Act 1985). Full accounts,
which have received an unqualified audit report and did not contain any
statement under section 237 of the Companies Act 1985, have been filed with the
Registrar of Companies.
The interim report was approved by the Board of Directors on 9 September 2003.
Financial information is published on the Company's website. The maintenance and
integrity of the Group website is the responsibility of the Directors; the work
carried out by the auditors does not involve consideration of these matters and,
accordingly, the auditors accept no responsibility for any changes that may
occur to the financial statements after they are initially presented on the
website.
It should be noted that legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
Independent Review Report to Woolworths Group plc
Introduction
We have been instructed by the Company to review the financial information which
comprises the consolidated profit and loss account, the consolidated balance
sheet, the consolidated cash flow statements and the related notes. We have read
the other information contained in the Interim Report and considered whether it
contains any apparent misstatements or material inconsistencies with the
financial information.
Directors' Responsibilities
The Interim Report, including the financial information contained therein, is
the responsibility of, and has been approved by the Directors. The Directors are
responsible for preparing the Interim Report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review Work Performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of management and applying analytical
procedures to the financial information and underlying financial data and based
thereon, assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities and
transactions. It is substantially less in scope than an audit performed in
accordance with United Kingdom Auditing Standards and therefore provides a lower
level of assurance than an audit. Accordingly we do not express an audit opinion
on the financial information. This report has been prepared for and only for the
Company for the purpose of the Listing Rules of the Financial Services Authority
and for no other purpose. We do not, in producing this report, accept or assume
responsibility for any other purpose or to any other person to whom this report
is shown or into whose hands it may come save where expressly agreed by our
prior consent in writing.
Review Conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the 26 weeks ended
2 August 2003.
PricewaterhouseCoopers LLP
Chartered Accountants
London
9 September 2003
This information is provided by RNS
The company news service from the London Stock Exchange
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