Final Results -13-
March 17 2009 - 3:00AM
UK Regulatory
| subsidiary | | | |
+----------------------------------------+-------+-------------+------------+
5. Finance Income and Expense
+----------------------------------------------+--+-------------+------------+
| | | 2008 | 2007 |
+----------------------------------------------+--+-------------+------------+
| Finance income | | GBP'000 | GBP'000 |
+----------------------------------------------+--+-------------+------------+
| Bank interest | | 4,032 | 4,174 |
+----------------------------------------------+--+-------------+------------+
| Interest receivable on convertible loan | | 138 | 268 |
| notes | | | |
+----------------------------------------------+--+-------------+------------+
| Other interest | | 828 | - |
+----------------------------------------------+--+-------------+------------+
| | | 4,998 | 4,442 |
+----------------------------------------------+--+-------------+------------+
+----------------------------------------------+--+-------------+------------+
| | | 2008 | 2007 |
+----------------------------------------------+--+-------------+------------+
| Finance expense | | GBP'000 | GBP'000 |
+----------------------------------------------+--+-------------+------------+
| Capitalised interest | | (16,540) | (9,955) |
+----------------------------------------------+--+-------------+------------+
| Interest payable on loans | | 18,530 | 12,593 |
+----------------------------------------------+--+-------------+------------+
| Interest payable and unwinding of discount | | 9,352 | 5,690 |
| on convertible bonds | | | |
+----------------------------------------------+--+-------------+------------+
| Unwinding charge for decommissioning | | 5,099 | 4,636 |
| provision (Note 21) | | | |
+----------------------------------------------+--+-------------+------------+
| Amortisation of loan facility expenses | | 1,743 | 4,521 |
+----------------------------------------------+--+-------------+------------+
| Other interest | | 1,085 | 1,637 |
+----------------------------------------------+--+-------------+------------+
| Foreign exchange loss on net foreign | | 20,230 | - |
| currency liabilities/assets | | | |
+----------------------------------------------+--+-------------+------------+
| | | 39,499 | 19,122 |
+----------------------------------------------+--+-------------+------------+
6. Income Tax Expense
+----------------------------------------+-------+-------------+------------+
| | | 2008 | 2007 |
+----------------------------------------+-------+-------------+------------+
| Analysis of charge for the year | | GBP'000 | GBP'000 |
+----------------------------------------+-------+-------------+------------+
| Current tax - current tax charge - UK | | 12,884 | 10,520 |
+----------------------------------------+-------+-------------+------------+
| Current tax - adjustments in respect | | 709 | 151 |
| of prior years | | | |
+----------------------------------------+-------+-------------+------------+
| Current tax - current tax charge - | | 1,561 | 2,442 |
| overseas | | | |
+----------------------------------------+-------+-------------+------------+
| | | 15,154 | 13,113 |
+----------------------------------------+-------+-------------+------------+
| Deferred tax - relating to origination | | 97,772 | 39,961 |
| and reversal of timing differences | | | |
+----------------------------------------+-------+-------------+------------+
| Deferred tax - adjustments in respect | | (5,393) | (42) |
| of prior years | | | |
+----------------------------------------+-------+-------------+------------+
| | | 92,379 | 39,919 |
+----------------------------------------+-------+-------------+------------+
| Tax charge for the year | | 107,533 | 53,032 |
+----------------------------------------+-------+-------------+------------+
The tax rate for the period is higher (2007: higher) than the standard rate of
corporation tax in the UK (28% - effective from 1 April 2008 (2007: 30%)). The
differences are explained below:
+----------------------------------------+--------+-------------+------------+
| | | 2008 | 2007 |
+----------------------------------------+--------+-------------+------------+
| | | GBP'000 | GBP'000 |
+----------------------------------------+--------+-------------+------------+
| Profit on ordinary activities before | | 184,189 | 101,207 |
| tax | | | |
+----------------------------------------+--------+-------------+------------+
| Tax @ 28.5% (2007: 30%) | | 52,494 | 30,362 |
+----------------------------------------+--------+-------------+------------+
| Effects of: | | | |
+----------------------------------------+--------+-------------+------------+
| Supplementary tax charge | | 48,355 | 24,058 |
+----------------------------------------+--------+-------------+------------+
| Adjustments to tax in respect of prior | | (4,684) | 109 |
| periods | | | |
+----------------------------------------+--------+-------------+------------+
| Unrecognised deferred tax asset | | 52 | 982 |
+----------------------------------------+--------+-------------+------------+
| Expenses not deductible for tax | | 4,897 | 545 |
| purposes | | | |
+----------------------------------------+--------+-------------+------------+
| Share options exercised | | (198) | (5,098) |
+----------------------------------------+--------+-------------+------------+
| Difference in corporation tax rate | | 5,684 | 1,377 |
| between ring fence and non ring fence | | | |
| trades | | | |
+----------------------------------------+--------+-------------+------------+
| Other | | 933 | 697 |
+----------------------------------------+--------+-------------+------------+
| Total taxation | | 107,533 | 53,032 |
+----------------------------------------+--------+-------------+------------+
Disallowable items mainly represent capital acquisition costs that are
depreciated but are not eligible for capital allowances.
7. Earnings Per Ordinary Share
Basic earnings per share is calculated by dividing the profit attributable to
equity holders of the Company by the weighted average number of ordinary shares
in issue during the year, excluding ordinary shares purchased by the EBT and
treasury shares.
+-----------------------------------------------+------------+------------+
| | 2008 | 2007 |
+-----------------------------------------------+------------+------------+
| Profit attributable to equity holders of the | 76,656 | 48,175 |
| Company (GBP'000) | | |
+-----------------------------------------------+------------+------------+
| Weighted average number of ordinary shares in | 145,568 | 135,479 |
| issue (thousands) | | |
+-----------------------------------------------+------------+------------+
| Basic earnings per share (pence per share) | 52.7 | 35.6 |
+-----------------------------------------------+------------+------------+
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding to assume conversion of all dilutive
potential ordinary shares. The Company has two categories of dilutive potential
ordinary shares: convertible debt and share options.
The convertible debt is assumed to have been converted into ordinary shares and
the net profit is adjusted to eliminate the interest expense and the unwinding
of discount on convertible debt less the tax effect. For the share options, a
calculation is performed to determine the number of shares that could have been
acquired at fair value (determined as the average annual market share price of
the Company's shares) based on the monetary value of the subscription rights
attached to outstanding share options.
The number of shares calculated as above is deducted from the number of
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