Tesco 2014 Annual Report Download - page 121

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Note 29 Reconciliation of profit before tax to cash generated from operations
2014
£m
2013
(restated*)
£m
Profit before tax 2,259 2,057
Net finance costs (Note 5) 432 397
Share of post-tax profits of joint ventures and associates (Note 13) (60) (72)
Operating profit of continuing operations 2, 631 2,382
Operating loss of discontinued operations (925) (1,451)
Depreciation and amortisation 1,567 1,590
Profits/losses arising on one-off property-related items from continuing operations (98) 580
Profits/losses arising on other property-related items from continuing operations (134) (419)
Profits/losses arising on property-related items from discontinued operations 162 288
Loss arising on sale of non property-related items (1) –
Profit arising on sale of subsidiaries and other investments 135
Impairment of goodwill (Note 10) 540 575
Impairment of other investments 42 –
Net charge of impairment of property, plant and equipment and intangible assets not included in property-related items 715 629
Adjustment for non-cash element of pensions charges 11 (4)
Additional contribution into pension scheme (4) (180)
Share-based payments (Note 25) 47 53
Tesco Bank non-cash items included in profit before tax 76 54
Increase in inventories (115) (54)
Increase in development stock (8) (40)
Increase in trade and other receivables (33) (104)
Increase/(decrease) in trade and other payables 509 (112)
(Decrease)/increase in provisions (73) 309
Tesco Bank increase in loans and advances to customers (Note 17) (1,432) (1,220)
Tesco Bank (increase)/decrease in trade and other receivables ( 31) 359
Tesco Bank increase in customer and bank deposits and trade and other payables 867 579
Tesco Bank increase in provisions 224
Increase in working capital (314) (259)
Cash generated from operations 4, 316 3,873
* Restated for amendments to IAS 19 as explained in Note 1.
The increase in working capital includes the impact of translating foreign currency working capital movements at average exchange rates rather than year end
exchange rates.
Included in (decrease)/increase in provisions are movements in respect of provisions for onerous contracts relating to continuing operations of £(46)m
(2013: £129m) which are included in property-related items as per the Group Income Statement, and relating to discontinued operations of £(37)m (2013:
£47m) which are included in property-related items as per Note 7.
Note 30 Analysis of changes in net debt
At
23 February
2013
£m
Tesco Bank at
23 February
2013
£m
Cash flow
£m
Business
combinations
£m
Other
non-cash
movements
£m
Net debt
of disposal
group
£m
Elimination
of Tesco Bank
£m
At
22 February
2014
£m
Cash and cash equivalents 1,457 1,055 378 9(105) (288) (485) 2,021
Short-term investments 522 –494 – – – – 1,016
Joint venture loans and other receivables 434 42 (96) –10 (136) (34) 220
Bank and other borrowings (10,066) (638) (818) –148 282 486 (10,606)
Finance lease payables (128) – 9 – 5 (7) –(121)
Net derivative financial instruments 1,172 (31) 36 –(470) – 5 712
Net debt of the disposal group 12 – – – – 149 –161
Net debt (6,597) 428 3 9 (412) –(28) (6,597)
Net debt excludes the net debt of Tesco Bank but includes that of the discontinued operations. Movements and balances related to Tesco Bank are included
within this analysis and the Reconciliation of net cash flow to movement in net debt note to allow reconciliation between the Group Balance Sheet and the
Group Cash Flow Statement. These movements and balances relating to Tesco Bank are subsequently eliminated to arrive at closing net debt.
Note 31 Business combinations and other acquisitions
During the current financial year, the Group completed business combination transactions with total cash consideration of £49m (2013: £30m), which are not
considered material to the Group individually or in aggregate.
118 Tesco PLC Annual Report and Financial Statements 2014
Notes to the Group financial statements continued