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104 Notes to the Company fi nancial statements 9 Net pension liability continued Actual returns and history of actuarial gains and losses The actual returns on pension scheme assets are as follows: Kingfi sher plc Annual Report and Accounts 2009/10 £ millions 2009/10 2008/09 Actual return/(loss) on pension scheme assets 4 (4) The history of actuarial gains and losses is as follows: £ millions 2009/10 2008/09 2007/08 2006/07 2005/06 Present value of defi ned benefi t obligation (49) (41) (41) (46) (41) Fair value of scheme assets 44 40 44 45 35 Net pension (liability)/asset before deferred tax (5) (1) 3 (1) (6) Changes in assumptions underlying present value of defi ned benefi t obligation (6) 1 3 (3) (5) Percentage of defi ned benefi t obligation 12% (2%) (7%) 7% 12% Actual return less expected return on pension scheme assets 1 (7) (2) 5 4 Percentage of scheme assets 2% (18%) (5%) 11% 11% Total (losses)/gains recognised in the profi t and loss reserve in the year (5) (6) 1 2 (1) No experience gains or losses arose on the defi ned benefi t obligation in the current or prior years. The estimated amount of contributions expected to be paid to the pension scheme by the Company during the next fi nancial year is £2m. Principal actuarial valuation assumptions The assumptions used in calculating the costs and obligations of the defi ned benefi t pension schemes are set by the directors after consultation with independent professionally qualifi ed actuaries. The assumptions are based on the conditions at the time and changes in these assumptions can lead to signifi cant movements in the estimated obligation. The discount rate is based on the yield on the iBoxx over 15 year AA-rated Sterling corporate bond index adjusted for the difference in term between iBoxx and scheme liabilities. The overall expected rate of return on scheme assets refl ects market expectations at the valuation date of long term asset returns and the mix of assets in the scheme. Annual % rate 2009/10 2008/09 Discount rate 5.5 6.5 Salary escalation 4.2 4.3 Rate of pension increases 3.4 3.5 Price infl ation 3.4 3.5 % rate of return 2009/10 2008/09 Equities 7.9 8.7 Bonds 4.7 5.6 Property 6.4 7.1 Other 4.2 4.3 Overall expected rate of return 5.9 6.7 The mortality assumptions used in the actuarial valuations have been selected with regard to the characteristics and experience of the membership of the scheme from 2004 to 2007. The base mortality assumptions have been derived by adjusting standard mortality tables (PA 92 tables) projected forward to 2007 with the medium cohort improvement factors for males and with the standard improvement factors for females. In addition, allowance has been made for future increases in life expectancy. For males, the allowance is in line with medium cohort improvements subject to a minimum rate of improvement of 1% pa, and for females, the allowance is in line with the standard improvements, subject to a minimum of 0.5% pa. These improvements have been set with regard to trends observed within the scheme over the past decade. The assumptions for life expectancy of the scheme members are as follows: Years 2009/10 2008/09 Age to which current pensioners are expected to live (60 now) – Male 87.2 87.2 – Female 85.9 85.9 Age to which future pensioners are expected to live (60 in 15 years’ time) – Male 88.8 88.8 – Female 87.1 87.1
Kingfi sher plc Annual Report and Accounts 2009/10 105 10 Called up share capital Number of Ordinary ordinary shares share capital millions £ millions At 1 February 2009 2,361 371 Shares issued under share schemes 1 – At 30 January 2010 2,362 371 The total number of authorised ordinary shares is 3,023m shares (2008/09: 3,023m shares) with a par value of 15 5 /7p per share. All issued shares are fully paid and represent a single class of ordinary shares. 11 Reserves Share Profi t premium Other and loss £ millions account reserves account Total At 1 February 2009 2,188 711 1,030 3,929 Profi t for the year – – 464 464 Actuarial losses on defi ned benefi t pension scheme – – (5) (5) Tax on items recognised directly in equity shareholders’ funds – – 1 1 Share-based compensation – – 5 5 Shares issued under share schemes 3 – – 3 Own shares purchased – – (7) (7) Own shares disposed – – 2 2 Dividends – – (125) (125) At 30 January 2010 2,191 711 1,365 4,267 The other reserves represent the premium on the issue of convertible loan stock in 1993 and the merger reserve relating to the acquisition of Darty. The value of own shares deducted from the profi t and loss reserve at 30 January 2010 is £54m (2008/09: £57m). 12 Reconciliation of movement in equity shareholders’ funds £ millions 2009/10 2008/09 Profi t/(loss) for the year 464 (1,947) Dividends (125) (125) 339 (2,072) Actuarial losses on defi ned benefi t pension scheme (5) (6) Tax on items recognised directly in equity shareholders’ funds 1 2 Share-based compensation 5 2 Shares issued under share schemes 3 – Own shares purchased (7) – Own shares disposed 2 5 Net increase/(decrease) in equity shareholders’ funds 338 (2,069) Equity shareholders’ funds at beginning of year 4,300 6,369 Equity shareholders’ funds at end of year 4,638 4,300
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