Notes to the financial statements
22 Provisions
| Group | Company | ||||||
|---|---|---|---|---|---|---|---|
| Onerous leases £m |
Restructuring and disposal provisions £m |
Long service awards £m |
Total £m |
Onerous leases £m |
Disposal provision £m |
Total £m |
|
| At 26 March 2006 | 56 | 123 | 7 | 186 | 7 | 26 | 33 |
| Charge to income statement | |||||||
| – Additional provisions | 8 | — | — | 8 | — | — | — |
| – Unused amounts reversed | (5) | — | — | (5) | — | — | — |
| Utilisation of provision | (14) | (80) | — | (94) | — | (1) | (1) |
| Transfer to retirement benefit obligations (note 31) | — | (13) | — | (13) | — | — | — |
| Amortisation of discount | 1 | — | — | 1 | — | — | — |
| At 24 March 2007 | 46 | 30 | 7 | 83 | 7 | 25 | 32 |
| Group | Company | |||
|---|---|---|---|---|
| 2007 £m |
2006 £m |
2007 £m |
2006 £m |
|
| Disclosed as: | ||||
| Current | 14 | 91 | 2 | 2 |
| Non-current | 69 | 95 | 30 | 31 |
| 83 | 186 | 32 | 33 | |
The onerous lease provision covers residual lease commitments of up to 27 years (2006: 28 years), after allowance for existing or anticipated sublet rental income.
The restructuring provisions of £5 million (2006: £97 million) relate to the Business Review and IT insourcing costs and are expected to be utilised in the financial year beginning 25 March 2007. The disposal provisions of £25 million (2006: £26 million) relate to indemnities arising from the disposal of subsidiaries, the timing of utilisation of which is uncertain.
Long service awards are accrued over the period the service is provided by the employee.
23 Called up share capital and share premium account
| 2007 million |
2006 million |
2007 £m |
2006 £m |
|
|---|---|---|---|---|
| Group and Company | ||||
| Authorised share capital | ||||
| Ordinary shares of 284/7 pence each (2006: 284/7 pence) | 2,450 | 2,450 | 700 | 700 |
| Preference B shares of 35 pence each (2006: 35 pence) | 2,100 | 2,100 | 735 | 735 |
| Called up share capital | ||||
| Allotted and fully paid – ordinary shares | 1,734 | 1,711 | 495 | 489 |
| Share premium account | ||||
| Share premium | 857 | 782 |
The movements in the called up share capital and share premium account are set out below:
| Ordinary shares million |
B shares million |
Ordinary shares £m |
B shares £m |
Share premium £m |
|
|---|---|---|---|---|---|
| At 26 March 2006 | 1,711 | — | 489 | — | 782 |
| Allotted in respect of share option schemes | 23 | — | 6 | — | 75 |
| At 24 March 2007 | 1,734 | — | 495 | — | 857 |
| At 27 March 2005 | 1,702 | 382 | 487 | 133 | 761 |
| IAS 32 adjustment | — | (382) | — | (133) | 1 |
| Restated at 27 March 2005 | 1,702 | — | 487 | — | 762 |
| Allotted in respect of share option schemes | 9 | — | 2 | — | 20 |
| At 25 March 2006 | 1,711 | — | 489 | — | 782 |
In the prior financial year, B shares were reclassified as short-term borrowings (note 20) on adoption of IAS 32 ‘Financial Instruments: Disclosure and Presentation’.
24 Capital redemption and other reserves
| Group and Company | Group | |||||
|---|---|---|---|---|---|---|
| Capital redemption reserve £m |
Currency translation reserve £m |
Actuarial gains/ (losses) £m |
Available -for-sale assets £m |
Cash flow hedge reserve £m |
Total other reserves £m |
|
| At 26 March 2006 | 668 | (1) | (90) | 90 | — | (1) |
| B shares redemption | 2 | — | — | — | — | — |
| Actuarial gains on defined benefit pension schemes | — | — | 127 | — | — | 127 |
| Available-for-sale financial assets | ||||||
| fair value movements | — | — | — | 17 | — | 17 |
| At 24 March 2007 | 670 | (1) | 37 | 107 | — | 143 |
| At 27 March 2005 | 547 | (3) | 90 | — | — | 87 |
| IAS 39 adjustment | — | — | — | 71 | — | 71 |
| Restated at 27 March 2005 | 547 | (3) | 90 | 71 | — | 158 |
| B shares redemption | 121 | — | — | — | — | — |
| Currency translation differences | — | 2 | — | — | — | 2 |
| Actuarial losses on defined benefit pension schemes | — | — | (180) | — | — | (180) |
| Available-for-sale financial assets | ||||||
| fair value movements |
— | — | — | 19 | — | 19 |
| Cash flow hedges | ||||||
| effective portion of fair value movements | — | — | — | — | 1 | 1 |
| transferred to income statement | — | — | — | — | (1) | (1) |
| At 25 March 2006 | 668 | (1) | (90) | 90 | — | (1) |
25 Retained earnings
| Group | Company | |||
|---|---|---|---|---|
| Own shares £m |
Profit and loss account £m |
Total retained earnings £m |
Retained earnings £m |
|
| At 26 March 2006 | (84) | 2,032 | 1,948 | 1,692 |
| Profit for the year | — | 325 | 325 | 190 |
| Dividends paid | — | (140) | (140) | (140) |
| Share-based payment | — | 55 | 55 | — |
| B shares redemption | — | (2) | (2) | (2) |
| Shares vested | 1 | — | 1 | — |
| Allotted in respect of share option schemes | — | (3) | (3) | — |
| At 24 March 2007 | (83) | 2,267 | 2,184 | 1,740 |
| At 27 March 2005 | (85) | 2,097 | 2,012 | 1,696 |
| IAS 32 and IAS 39 adjustments | — | (17) | (17) | (17) |
| Restated at 27 March 2005 | (85) | 2,080 | 1,995 | 1,679 |
| Profit for the year | — | 64 | 64 | 153 |
| Dividends paid | — | (131) | (131) | (131) |
| Share-based payment | — | 28 | 28 | — |
| B shares redemption |
— | (9) | (9) | (9) |
| Shares vested | 1 | — | 1 | — |
| At 25 March 2006 | (84) | 2,032 | 1,948 | 1,692 |
Own shares held by Employee Share Ownership Plan (“ESOP”) trusts
The Group owned 23,567,107 (2006: 24,224,676) of its ordinary shares of 284/7 pence nominal value each. At 24 March 2007, the total nominal value of the own shares was £6.7 million (2006: £6.9 million).
43,450 (2006: 404,228) of the own shares are held by an ESOP trust on behalf of certain Directors and senior employees under the Group’s Performance Share Plan. The remaining 23,523,657 shares (2006: 23,820,448) are held by an ESOP trust for the Executive Share Option Plan. The ESOP trusts waive the rights to the dividends receivable in respect of the shareholder under the above schemes.
The cost of the own shares is deducted from equity in the Group financial statements. The market value of the own shares at 24 March 2007 was £129.5 million (2006: £80.1 million).