IFRS presentation to analysts and investors - About United Utilities

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Movement in 2004/05 retained earnings18001600No impact on dividend capacity asUnited Utilities PLC parent companybalance sheet largely unaffected2004/05 Retained Earnings (£m)140012001000800600400ConsolidatedUnited Utilities PLC Parent Company2000UK GAAP IAS 10 Dividends IAS 12 DeferredTax DiscountIAS 19 Pensions SSAP 24Prepaym entDerecognitionOther“… the distributable reserves of the United Utilities PLC parent company balancesheet, from which dividend payments are made, are largely unaffected by IFRS …”48However, as this slide shows, the value of the IFRS restatements to the reservesof the United Utilities PLC parent company balance sheet are not material.In contrast to the consolidated accounts, you can see an almost unchangedposition in regard to the retained earnings of the United Utilities PLC parentcompany balance sheet, from which dividend payments are made.
IFRS impact on key ratios and financialsEBITDAOperating MarginInterest CoverDividend Cover(pre-deferred tax)Dividend CoverNet DebtGearing 5 (excludingjoint venture debt)Net AssetsIFRS£1,078m 128.9% 12.4x 11.3x0.9x 3£4,279m64%£2,144mUK GAAP£1,058m 230.7% 22.4x 21.3x1.1x 4£4,141mNet Debt (excluding£4,141m£4,141m-Gearing 5 67%57%(10%)joint venture debt)57%£3,119mMovement£20m(1.8%)--(0.2x)(£138m)(7%)(£975m)1before intangibles previously classified as goodwill under UK GAAP and restructuring costs2 before goodwill and exceptional items3 before deferred tax and intangibles previously classified as goodwill under UK GAAP and restructuring costs4before deferred tax and goodwill and exceptional items5net debt / net debt plus shareholders’ funds49I’d now like to focus on some key financial measures.EBITDA marginally increases by just under 2 per cent under IFRS.Our operating margin falls by around 2 per cent, with the change in treatment ofinfrastructure assets a main contributor.Interest cover remains broadly unchanged, as does dividend cover on a predeferredtax basis.Net debt increases by £138 million, representing an increase of just over 3 percent, but this primarily relates to joint venture debt which is typically nonrecourseto United Utilities.Gearing is up 10 per cent to 67 per cent, with a smaller increase of 7 per cent, to64 per cent, when joint venture debt is excluded. This is because, although thenet debt increase primarily relates to joint venture debt, the required IFRSadjustments, principally deferred tax, reduce net assets.
Page 1 and 2: United Utilities PLCInternational F
Page 3 and 4: Simon BateyGroup Finance DirectorGo
Page 5 and 6: IFRS conversion timetable31/03/04 3
Page 7 and 8: IFRS headlines - effect on 2004/05
Page 9 and 10: Segmental operating profit£mIFRS 1
Page 11 and 12: United Utilities’ basis of prepar
Page 13 and 14: Infrastructure Accounting (IAS 16)
Page 15 and 16: Infrastructure Accounting (IAS 16)I
Page 17 and 18: IFRS impact - net assets at 31 Marc
Page 19 and 20: Interests in Joint Ventures (IAS 31
Page 21 and 22: Interests in Joint Ventures (IAS 31
Page 23 and 24: Defined Benefit Pension Scheme Acco
Page 27 and 28: Business Combinations (IAS 38 / IFR
Page 31 and 32: Deferred Tax (IAS 12)• IAS 12 doe
Page 33 and 34: Major IFRS adjustments representing
Page 37 and 38: Accounting for Derivatives (IAS 39)
Page 39 and 40: Accounting for Derivatives (IAS 39)
Page 41 and 42: Operating Profit (£m)IFRS impact -
Page 45 and 46: IFRS impact - 2004/05 earnings per
Page 47: Retained Earnings• The consolidat
Page 51 and 52: Summary• Overall impact on profit

IFRS presentation to analysts and investors - About United Utilities

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