GPG Report & Accounts 2003 - Guinness Peat Group plc

42 • GUINNESS PEAT GROUP PLC • ANNUAL REPORTNotes to Financial Statements – continued27. ReservesGROUPShare Capital Profitpremium redemption Other and lossaccount reserve reserve account£000 £000 £000 £000At 1 January 2003 1,344 – 263,761 71,966Premium on shares issued (net of expenses) 2,456 – – –Capitalisation issue of shares – – (3,165) –Scrip dividend alternative (411) – – 4,105Currency translation differences – – – 515Release of negative goodwill on disposals – – – (333)Deferred tax on foreign currency translation differences – – – 3,501Buy back of shares – 521 – (5,955)Retained profit for the year – – – 57,072AT 31 DECEMBER 2003 3,389 521 260,596 130,871The “other reserve” resulted from the 2002 reverse acquisition following the issue of shares by GPG as part of its acquisitionof GPGUKH.Cumulative negative goodwill taken directly to reserves in respect of acquisitions prior to 1998 amounts to £2,774,000.The profit and loss account includes £2,490,000 of unrealised profits on the part disposal of ENZA in 2002.COMPANYShare Capital Profitpremium redemption Other and lossaccount reserve reserve account£000 £000 £000 £000At 1 January 2003 1,344 – 157,761 88,278Premium on shares issued (net of expenses) 2,456 – – –Capitalisation issue of shares – – (3,165) –Scrip dividend alternative (411) – – 4,105Buy back of shares – 521 – (5,955)Retained loss for the year – – – (15,535)AT 31 DECEMBER 2003 3,389 521 154,596 70,89328. Contingent LiabilitiesGPG has guaranteed the repayment of principal,interest and unpaid accrued interest due on the NZ$250 million 2001 CapitalNotes and on the NZ$215 million 2003 Capital Notes in the event of a liquidation of the issuing subsidiary or GPGUKH (see note22).In addition,it has guaranteed (on a subordinated basis) the obligations of GPGUKH in respect of the payment of principal andaccrued interest under the CLNs (see note 21).As at 31 December 2003, Staveley had contingent liabilities in respect of performance bonds, tender bonds and guarantees forthird parties amounting to £2,000,000 (2002: £3,200,000). In addition, Staveley and certain of its subsidiaries are parties to legalactions and claims arising in the ordinary course of business, which the directors are advised and believe are likely to beresolved without significant effect on the net assets of the Group.A subsidiary of Canberra Investment Corporation Ltd (“Canberra”) is jointly and severally liable for all the liabilities of theHarcourt Hill Estate joint venture. The assets of the joint venture at year-end were sufficient to meet such liabilities. In addition,Canberra has guaranteed the bank facilities of a joint arrangement in which it has a 50% interest. As at 31 December 2003,these facilities amounted to £Nil (2002: £Nil).