GSK Annual Report 2002

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92 GlaxoSmithKline Notes to the financial statements 12 Taxation continued Except as shown in these Financial statements, no provision has been made for taxation which would arise on the distribution of profits retained by overseas subsidiary and associated undertakings, on the grounds that no remittance of profit retained at 31st December 2002 is required in such a way that incremental tax will arise. At 31st December 2002, the Group had corporate tax losses of approximately £69 million and capital losses estimated to be in excess of £9 billion which are not recognised as deferred tax assets because there is insufficient evidence that these losses will be used. Current Deferred Deferred tax creditor tax debtor tax provision Tax balances £m £m £m At 1st January 2002 as previously reported (1,672) 871 – Prior year adjustment – 426 (553) At 1st January 2002 as restated (1,672) 1,297 (553) Exchange adjustments 103 (79) (12) Charge to profit and loss account (1,398) (15) (14) Cash paid 1,633 – – Other movements (115) 170 (163) At 31st December 2002 (1,449) 1,373 (742) 2001 2002 (restated) Deferred taxation asset/(liability) £m £m Accelerated capital allowances (710) (691) Stock valuation adjustment (113) (113) Intra-Group profit 487 375 Product and business disposals (125) (161) Pensions and other post-retirement benefits 190 298 Tax losses 93 97 Legal and other disputes 124 25 Manufacturing restructuring 52 71 Other net timing differences 633 843 Of the above categories of provided deferred taxation, stock valuation adjustments, intra-Group profit and other timing differences are current. All deferred taxation movements arise from the origination and reversal of timing differences. 631 744 The Group has implemented the new Financial Reporting Standard, FRS 19 ‘Deferred Tax’, in 2002, which requires deferred tax to be accounted for on a full provision basis rather than a partial provision basis as before. For the full year 2001 the business performance tax charge is increased by £8 million, and the total tax charge by £6 million. The net deferred tax asset at 31st December 2001 has been reduced by £127 million.
13 Earnings per share Notes to the financial statements GlaxoSmithKline 93 2001 2000 2002 (restated) (restated) p p p Basic earnings per share 66.2 50.3 67.7 Adjustment for merger items, restructuring costs and disposal of subsidiaries: Merger integration and transaction costs 10.8 13.0 6.8 Product divestments – – (16.8) Restructuring costs 1.5 2.0 2.2 Block Drug integration costs 0.7 1.6 – Disposal of businesses (0.9) 5.4 0.2 Associates – – 0.1 Adjusted earnings per share 78.3 72.3 60.2 Diluted earnings per share 66.0 49.9 66.9 Basic and adjusted earnings per share have been calculated by dividing the profit attributable to shareholders by the weighted average number of shares in issue during the period. The numbers used in calculating basic and diluted earnings per share are reconciled below. To illustrate business performance, which is the primary performance measure used by management, adjusted earnings and adjusted earnings per share are presented after excluding merger items, integration and restructuring costs and disposal of businesses. Management believes that exclusion of these non-recurring items provides a better comparison of business performance for the periods presented. Accordingly this information is provided as a supplement to that contained in the consolidated statement of profit and loss on pages 76 and 77 prepared in accordance with UK GAAP. Basic and diluted earnings per share include these non-recurring items. Net profit for the period attributable to shareholders £m £m £m Earnings – basic and diluted 3,915 3,053 4,106 Adjustments for merger items, restructuring costs and disposal of subsidiaries 712 1,330 (452) Adjusted earnings 4,627 4,383 3,654 Weighted average number of shares in issue millions millions millions Basic and adjusted 5,912 6,064 6,065 Dilution for share options 22 52 69 Diluted 5,934 6,116 6,134 Shares held by the Employee Share Ownership Trusts (ESOT) are excluded. The trustees have waived their rights to dividends on the shares held by the ESOT’s.
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Do more, feel better, live longer T
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The Annual Report was approved by t
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Joint statement by the Chairman and
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04 GlaxoSmithKline Joint statement
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Products - Pharmaceuticals Descript
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Additionally, GlaxoSmithKline marke
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Competition - Consumer Healthcare T
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Operating activities Marketing and
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Description of business GlaxoSmithK
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Description of business GlaxoSmithK
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Product approvals Country/Region Pr
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As part of GlaxoSmithKline’s majo
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Operating resources Intellectual pr
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Compensation philosophy and program
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Access to healthcare in the develop
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GlaxoSmithKline gave unrestricted g
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Corporate governance This section d
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Corporate Executive Team (CET) JP G
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The Annual General Meeting takes pl
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Research and development Safety of
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Remuneration report GlaxoSmithKline
Page 43 and 44: The majority of the competitor pane
Page 45 and 46: Performance graph 100 90 80 70 60 N
Page 47 and 48: Non-Executive Directors Non-Executi
Page 49 and 50: Non-Executive Directors’ share ar
Page 51 and 52: Incentive plans Remuneration report
Page 53 and 54: Operating and financial review and
Page 55 and 56: 2002 Year World economy The world
Page 57 and 58: Pharmaceutical sales by therapeutic
Page 59 and 60: Consumer Healthcare sales 2002 2001
Page 61 and 62: Earnings 2001 2002 (restated) CER%
Page 63 and 64: Contractual obligations and commitm
Page 65 and 66: Funding, maturity and counterparty
Page 67 and 68: Stricter regulatory controls also h
Page 69 and 70: Operating and financial review and
Page 71 and 72: Latin America reported eight per ce
Page 73 and 74: Selected financial data UK/US GAAP
Page 75 and 76: Financial statements GlaxoSmithKlin
Page 77 and 78: Independent Auditors’ report to t
Page 79 and 80: Consolidated statement of profit an
Page 81 and 82: Consolidated statement of cash flow
Page 83 and 84: Company balance sheet at 31st Decem
Page 85 and 86: 2 Accounting policies Consolidation
Page 87 and 88: 2 Accounting policies continued Sto
Page 89 and 90: 6 Segment information continued Not
Page 91 and 92: 7 Merger items, restructuring costs
Page 93: Notes to the financial statements G
Page 97 and 98: Notes to the financial statements G
Page 99 and 100: 19 Equity investments Notes to the
Page 105 and 106: 30 Legal proceedings The Group is i
Page 107 and 108: 30 Legal proceedings continued In F
Page 109 and 110: 30 Legal proceedings continued In 2
Page 111 and 112: 31 Acquisitions and disposals conti
Page 113 and 114: 32 Financial instruments and relate
Page 115 and 116: 32 Financial instruments and relate
Page 117 and 118: 33 Employee costs continued Notes t
Page 119 and 120: 33 Employee costs continued Notes t
Page 121 and 122: 34 Employee share schemes continued
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Page 125 and 126: 37 Reconciliation to US accounting
Page 141 and 142: 38 Principal Group companies Notes
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Financial record GlaxoSmithKline 14
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Investor information GlaxoSmithKlin
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Shareholder information Ordinary sh
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Share capital GlaxoSmithKline 155 A
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Cross reference to Form 20-F GlaxoS
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Index A Access to healthcare 27 Acc
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Contact details INTERNET Informatio
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GSK Annual Report 2002

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