ARLA FOODS UK
GROUP PROFIT AND LOSS ACCOUNT
for the six months to 31 March 2004
 
 
                                                                                               Restated        Restated
                                                                              Unaudited       Unaudited         Audited
                                                             Notes           six months   six months to            Year
                                                                            to 31.03.04        30.09.03     to 31.03.03
                                                                                     £m              £m              £m
                                                                                     
Turnover
Group and share of joint venture                                                  700.0           325.3           716.2
Less share of joint venture                                                       (2.1)           (1.8)           (1.5)
Continuing operations                                                             697.9           323.5           697.2
Discontinued operations                                                               -               -            17.5
                                                                                 ______          ______          ______
Group turnover                                                   2                697.9           323.5           714.7
 
Cost of sales                                                                   (506.4)         (220.5)         (474.5)
                                                                                 ______           _____           _____
Gross profit                                                                      191.5           103.0           240.2
Operating expenses before goodwill amortisation
and operating exceptional items                                  3              (164.1)          (89.1)         (202.1)
                                                                                 ______          ______          ______
Operating profit before goodwill amortisation and operating
exceptional items                                                                  27.4            13.9            38.1
                                                                                   
Goodwill amortisation                                                             (4.2)           (2.2)           (4.6)
Operating exceptional items                                      4               (10.5)           (1.8)          (12.9)
                                                                                 ______         _______         _______
Operating profit
Continuing operations                                                              12.7             9.9            19.7
Discontinued operations                                                               -               -             0.9
                                                                                 ______          ______          ______
                                                                                   12.7             9.9            20.6
 
Share of loss in joint venture                                                    (0.4)           (0.1)           (0.3)
Share of loss in associate                                                        (0.3)               -               -
                                                                                 ______          ______          ______
                                                                                   12.0             9.8            20.3
 
Non operating exceptional items                                  4                (1.4)               -             0.2
                                                                                 ______          ______          ______
                                                                                   10.6             9.8            20.5
 
Net interest payable                                             5                (5.6)           (3.7)           (8.9)
                                                                                 ______          ______          ______
Profit on ordinary activities before taxation                                       5.0             6.1            11.6
Tax on profit on ordinary activities                             6                (3.7)           (2.3)           (4.4)
                                                                                 ______         _______          ______
Profit on ordinary activities after taxation                                        1.3             3.8             7.2
 
Equity dividends                                                 7               (32.2)           (3.0)           (3.0)
                                                                                 ______          ______          ______
(Deficit)/retained profit for the period                                         (30.9)             0.8             4.2
                                                                                 ______          ______          ______
Earnings per ordinary share - basic                              8                 0.2p            1.3p            2.4p
                            - adjusted                           8                 2.4p            2.5p            6.6p
                            - diluted                            8                 0.2p            1.3p            2.4p
 
 
 
 
 
 
GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the six months to 31 March 2004
 
                                                                                                 Restated      Restated
                                                                               Unaudited        Unaudited  Audited Year 
                                                                              six months   six months  to   to 31.03.03 
                                                                             to 31.03.04         30.09.03
                                                                                      £m               £m            £m
 
Profit attributable to shareholders                                                  1.3              4.0           7.6
Prior year adjustments - implementation of UITF 38/17                              (0.6)                -             -
                                                                                  ______           ______        ______
 
Total recognised gains and losses since the last annual report                       0.7              4.0           7.6
                                                                                  ______           ______        ______
 
 
 
SUMMARISED GROUP BALANCE SHEET
at 31 March 2004
                                                                                          Restated             Restated
                                                                    Unaudited            Unaudited              Audited
                                                                     31.03.04             30.09.03             31.03.03
                                                                           £m                   £m                   £m
Fixed assets
Intangible assets                                                       105.8                 55.2                 57.2
Tangible assets                                                         232.9                127.8                133.1
Investments
    Investment in joint venture
    Share of gross assets                                                 4.3                  3.8                  3.7
    Share of gross liabilities                                          (2.6)                (1.7)                (1.5)
                                                                   __________             ________             ________
                                                                          1.7                  2.1                  2.2
    Investment in associate                                               1.7                  2.0                  2.0
                                                                   __________             ________             ________
                                                                          3.4                  4.1                  4.2
                                                                   __________             ________             ________
                                                                        342.1                187.1                194.5
                                                                   __________             ________             ________
Current assets
Stocks                                                                   23.0                  6.8                  7.4
Debtors                                                                 136.1                 71.4                 64.2
Deferred taxation (due in more than one year)                             4.3                    -                    -
Cash at bank and in hand                                                 57.3                 12.9                 21.6
                                                                   __________             ________             ________
                                                                        220.7                 91.1                 93.2
                                                                   __________             ________             ________
Creditors: due within one year
Borrowings                                                               10.4                 11.3                 14.0
Trade creditors                                                         147.1                 54.8                 58.4
Other creditors and accruals                                             43.9                 36.3                 40.4
Current taxation                                                          9.4                  8.9                  6.1
Dividend payable                                                          3.6                  3.0                  1.8
                                                                   __________             ________             ________
                                                                        214.4                114.3                120.7
                                                                   __________             ________             ________
Net current assets/(liabilities)                                          6.3               (23.2)               (27.5)
                                                                   __________             ________             ________
Total assets less current liabilities                                   348.4                163.9                167.0
                                                                   __________             ________             ________
Creditors: due after one year
Borrowings                                                              173.8                107.5                110.9
                                                                   __________             ________             ________
                                                                        174.6                 56.4                 56.1
                                                                   __________             ________             ________
Provisions for liabilities and charges
Deferred taxation                                                           -                  9.8                 10.5
Post retirement health care                                               1.2                  1.3                  1.4
Pensions                                                                 21.0                    -                    -
                                                                      _______              _______              _______
                                                                         22.2                 11.1                 11.9
                                                                      _______              _______              _______
                                                                        152.4                 45.3                 44.2
                                                                      _______              _______              _______
Capital and reserves
Called up share capital                                                  12.2                  6.0                  6.0
Share premium account                                                    27.4                  0.2                  0.2
Merger reserve                                                           99.6                (4.9)                (4.9)
Investment in own shares                                                (2.6)                (2.6)                (2.6)
Profit and loss account                                                  15.8                 46.6                 45.5
                                                                      _______              _______              _______
Equity shareholders' funds                                              152.4                 45.3                 44.2
                                                                      _______              _______              _______
 
GROUP CASH FLOW STATEMENT
for the six months to 31 March 2004
                                                                                             Restated        Restated
                                                                          Unaudited         Unaudited         Audited
                                                                         six months       six months             Year
                                                                        to 31.03.04       to 30.09.03     to 31.03.03
                                                                                 £m                £m              £m
 
Operating profit                                                               12.0               9.8            20.3
Share of loss in joint venture                                                  0.4               0.1             0.3
Share of loss in associate                                                      0.3                 -               -
Depreciation including operating exceptional write down                        17.8               8.9            19.4
Amortisation                                                                    4.2               2.2             4.6
Provision against fixed asset investment                                          -                 -             0.3
Profit on disposal of intangible fixed assets                                     -                 -           (0.1)
UITF 38/17 credit                                                               0.1               0.3             0.6
Working capital movement                                                       37.0            (15.4)            11.4
                                                                             ______            ______          ______
Net cash inflow from operating activities                                      71.8               5.9            56.8
 
Returns on investments and servicing of finance
 
Net proceeds on realised gains on financial instruments                           -                 -             0.3
Interest received                                                               0.1               0.1             0.3
Interest paid                                                                 (5.4)             (3.6)           (9.1)
Interest element of finance lease rental payments                             (0.3)             (0.2)           (0.3)
                                                                             ______            ______          ______
Net cash outflow from returns on investments and servicing of
finance
                                                                              (5.6)             (3.7)             (8.8)
 
Taxation paid                                                                 (3.3)                 -             (1.2)
 
Capital expenditure and financial investment
Purchase of tangible fixed assets                                            (33.0)             (5.3)            (10.9)
Proceeds from disposal of intangible and tangible fixed assets                  6.5               2.5             5.6
                                                                             ______            ______          ______
Net cash outflow from capital expenditure                                    (26.5)             (2.8)             (5.3)
 
Acquisitions and disposals
 
Disposal of businesses (including expenses)                                     2.8                 -            30.0
Acquisitions of businesses (including expenses)                               (6.5)             (0.2)           (5.7)
Net cash balances acquired on acquisitions                                      2.3                 -               -
                                                                             ______            ______          ______
Net cash (outflow)/inflow on acquisitions and disposals                       (1.4)             (0.2)            24.3
 
Equity dividends paid                                                        (31.6)             (1.8)           (1.2)
                                                                             ______            ______          ______
Cash inflow/(outflow) before financing                                          3.4             (2.6)            64.6
 
                                                                             ______            ______          ______
 
Financing
Movement in short term borrowings                                            (17.4)                 -           (1.7)
Movement in long term borrowings                                               47.6             (7.8)          (64.7)
Repurchase and cancellation of US Loan Notes                                  (0.7)                 -           (8.7)
Proceeds from sale and leaseback transactions                                  24.3               9.8               -
Capital element of finance lease rental payments                              (6.1)             (3.2)           (2.5)
                                                                            _______           _______         _______
Net cash inflow/(outflow) from financing                                       47.7             (1.2)          (77.6)
                                                                            _______           _______         _______
Increase/(decrease) in cash in the period                                      51.1             (3.8)          (13.0)
                                                                            _______           _______         _______
 
 
 
In the six months to 31 March 2004 there was a significant non-cash movement
relating to the acquisition of Arla Foods plc.   Ordinary shares to the value of
£137.9m were issued as consideration for the acquisition of 100% of the ordinary
shares of Arla Foods plc.