Vodafone 1999 Annual Report Download - page 20

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Financial Review
Investments
£m
At 1 April 1998 202.2
Net new investments 101.4
Share of profits in associated undertakings 71.5
Currency translation and other movements (2.7)
––––––
At 31 March 1999 372.4
––––––
Working capital
Working capital (excluding amounts included within Group net debt) decreased by £5.5m, primarily as a result of an
increase in creditors due within one year of £215.4m offset by a £194.1m increase in debtors. These changes are due to
the inclusion of working capital balances of subsidiaries acquired in the year and the growth of the business.
Equity shareholders’ funds
The Group’s equity shareholders’ funds do not include any valuations that could be placed on licences that were acquired
for no initial cost. Licences that have an initial cost to the Group are capitalised at cost and written-off in accordance with
the Group’s accounting policy. The balance sheet also excludes any value attributable to future income streams that are
anticipated from existing customers.
Equity shareholders’ funds increased by £532.1m to £814.6m, mainly due to retained profits of £439.9m and the benefit of
scrip dividends of £64.8m.
BACK TO TOP
Cash flows and net borrowings
Net cash flow generated from operating activities increased by £158.8m to £1,045.2m and was used mainly to fund capital
expenditure of £754.4m, primarily to enhance and expand the digital networks in the UK, Australia, the Netherlands and
Greece, pay tax of £194.6m and finance interest and dividends to minority shareholders of £89.8m and £118.5m of equity
dividends. Net new investments of £264.8m comprised a cash outflow of £343.9m in respect of acquisitions and
investments offset by a cash inflow of £79.1m from investment and business disposals. As a result, net borrowings
increased by £391.0m to £1,508.0m. An analysis of net cash outflows in respect of investments is set out in the table
below.
Net cash outflow – investments
£m
Vodafone New Zealand 234.6
Misrfone 63.1
Other 46.2
––––––
343.9
––––––
Future investment
Vodafone companies in the Group at 31 March 1999 expect to spend approximately £1,000m on tangible fixed assets in
1999/2000. About half of this expenditure will be in the UK, where capacity continues to be added to the digital network to
accommodate growth in customer numbers and traffic generated by visitors. The balance will be expended mainly on the
http://www.vodafone.com/download/investor/reports/annual99/financial_review.htm (5 of 10)30/03/2007 00:08:22