Corus Group plc Preliminary Report for the 12 Months to 28 December 2002.Business Editors LONDON--(BUSINESS WIRE)--March 14, 2003 Corus Group Corus Group plc, normally referred to simply as Corus, is one of the world's largest producers of steel, headquartered in London. It was formed from the merger of Koninklijke Hoogovens N.V. plc The Consolidated Profit and Loss Account, Consolidated Balance Sheet, Statement of Total Recognised Gains and Losses, Reconciliation of Movements in Shareholders' Funds and the Consolidated Cash Flow Statement shown in respect of the year ended 28 December 2002 are extracted from the full accounts for that year which were approved by the Board of Directors on 14 March 2003 and will be filed with the Registrar of Companies. The financial information contained in this announcement does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. The report of the auditors on these accounts is unqualified and does not contain a statement under Section 237 (2) or (3) of the Companies Act 1985. The audit report refers to a fundamental uncertainty in respect of the application of the going concern basis described in the Review of the Period on page 10, "Going concern". The Report and Audited Financial Statements will be mailed to shareholders later this month at which time copies will also be available from the Secretary's Office, Corus, 30 Millbank, London SW1P 4WY, or by telephoning 0800 484113. KEY HIGHLIGHTS -- Operating loss before exceptional items for second half year reduced to GBP141m (GBP252m in first half). -- Non-cash impairment charges for carbon steel operations of GBP109m and UK deferred tax write-off of GBP42m. -- Net loss for year of GBP458m. -- Net borrowings reduced by GBP324m during 2002. CHAIRMAN'S STATEMENT "The underlying results for the Group for the year were marginally mar·gin·al adj. 1. Of, relating to, located at, or constituting a margin, a border, or an edge: the marginal strip of beach; a marginal issue that had no bearing on the election results. 2. below the level of the previous year with a Group operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of GBP GBP In currencies, this is the abbreviation for the British Pound. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 393m (2001: GBP377m), before taking into account exceptional items of GBP53m (2001: GBP8m). The net loss after tax and minority interests for the year amounted to GBP458m and, in the light of this result, the Board has decided not to recommend the payment of a dividend in respect of 2002. While further progress was made in securing improvements in operational performance and efficiency, the absence of any real global economic recovery was the major factor which led to the poor results for the year. The trend through 2002 saw prices in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , Corus' major
market, fall sharply during the first quarter prior to some modest
recovery in the second quarter and, subsequently, further increases
during the second half. As a result, for the second half year the Group
incurred an operating loss of GBP141m, before exceptional items, as
compared with GBP252m in the first half, with an improvement of GBP124m
in carbon steel being partially offset by a fall of GBP13m in the
operating profit Operating profit (or loss)Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of aluminium. At the end of the year, net debt amounted to GBP1,236m and gearing was reduced to 46%. Net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from acquisitions and disposals amounted to GBP445m while ongoing cash flow demands amounted to GBP121m, giving a reduction in net debt of GBP324m in the year. The year under review for Corus Corus may refer to:
tr.v. frus·trat·ed, frus·trat·ing, frus·trates 1. a. To prevent from accomplishing a purpose or fulfilling a desire; thwart: in other respects. The implementation of the Group's strategy of focussing on its carbon steel operations began with the disposal of our stainless steel stainless steel: see steel. stainless steel Any of a family of alloy steels usually containing 10–30% chromium. The presence of chromium, together with low carbon content, gives remarkable resistance to corrosion and heat. interests in AvestaPolarit, the completion of the sale of our 20% interest in the aluminium business of Aluminerie Alouette Aluminum smelter at Sept-Îles, Quebec, Canada, on the North Shore of the Gulf of St. Lawrence. With the successful start-up of a of a major expansion in 2005, the Alouette Aluminum Smelter, at 550,000 metric tonnes capacity per year, became the largest primary aluminum smelter in and progressing the sale of the Group's remaining aluminium assets. There were also a number of smaller transactions including the acquisition of two downstream From the provider to the customer. Downloading files and Web pages from the Internet is the downstream side. The upstream is from the customer to the provider (requesting a Web page, sending e-mail, etc.). carbon steel operations, one in Sweden Sweden, Swed. Sverige, officially Kingdom of Sweden, constitutional monarchy (2005 est. pop. 9,002,000), 173,648 sq mi (449,750 sq km), N Europe, occupying the eastern part of the Scandinavian peninsula. and the other in the UK. However, and despite the strong strategic rationale rationale (rash´  nal´),n the fundamental reasons used as the basis for a decision or action. , discussions regarding the proposed merger between Corus and CSN CSN Crosby, Stills, and Nash (band) CSN Centrala studiestödsnämnden (Swedish: state education grant and loan program) CSN Confédération des Syndicats Nationaux (French) in Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. , announced in July July: see month. , regrettably had to be terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: in November November: see month. due to the deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. of, and ongoing uncertainties in, the global business environment and financial markets. The sale of our aluminium rolled products and extrusions businesses to Pechiney Pechiney SA was a major aluminum conglomerate based in France until it was acquired in 2003 by the Alcan corporation headquartered in Canada. Prior to its acquisition, Pechiney grew to be the world's 4th largest producer and developer of aluminum products, employing 34,000 was agreed in principle in October October: see month. for approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. GBP543m. The businesses are owned by Corus Nederland Nederland (nē`dərlənd), city (1990 pop. 16,192), Jefferson co., SE Tex.; founded by Dutch settlers as a rice-farming community in 1897, inc. 1940. BV, and the sale was, inter alia [Latin, Among other things.] A phrase used in Pleading to designate that a particular statute set out therein is only a part of the statute that is relevant to the facts of the lawsuit and not the entire statute. , subject to the approval of that company's Supervisory Board Supervisory board The board of directors that represents stakeholders in the governance of the corporation. . In the event and despite the recommendation of the Management Board of Corus Nederland BV, the Supervisory Board was not willing to give its approval. Following an unsuccessful petition petition Written instrument directed to an individual, government official, legislative body, or court in order to seek redress of grievances or to request a favour. to the Court in Amsterdam Amsterdam, city, Netherlands Amsterdam (ăm`stərdăm', Dutch ämstərdäm`), city (1994 pop. 724,096), constitutional capital and largest city of the Kingdom of the Netherlands, North Holland prov. for that decision to be set aside, the sale will not take place. The decision of the Supervisory Board to reject re·ject v. 1. To refuse to accept, submit to, believe, or use something. 2. To discard as defective or useless; throw away. 3. To spit out or vomit. 4. the sale of the aluminium businesses was taken in the face of detailed proposals by Corus Group to meet the legitimate concerns that the Supervisory Board had expressed for the consequences of that sale for Corus Nederland BV. The Board views this outcome as extremely disappointing and is reviewing the implications of it on its carbon steel strategy and related funding plans. The carbon steel strategy is focussed on eliminating the Group's losses which continue to emanate em·a·nate intr. & tr.v. em·a·nat·ed, em·a·nat·ing, em·a·nates To come or send forth, as from a source: light that emanated from a lamp; a stove that emanated a steady heat. from the UK despite the steps that have been undertaken in recent years to reduce capacity and improve competitiveness. Unfortunately the progressive decline in UK manufacturing, coupled with the strength of sterling and increased penetration The successful unauthorized breach of a security perimeter. See penetration test. from steel imports, has undermined these initiatives. It is clear, however, that Corus' UK losses have got to be reversed and this will inevitably lead to significant further capacity reductions and concentration of operations onto fewer sites. A review by the Board is currently in progress and an announcement will be made on its findings as soon as possible. The proceeds of the aluminium sale would have provided the capacity to finance the measures needed to reduce capacity in the UK but, with the sale no longer proceeding, the Group will need to look afresh a·fresh adv. Once more; anew; again: start afresh. afresh Adverb once more Adv. 1. for finance from equity and debt providers, and from the sale of non-core assets. The timing and extent of further actions to be taken will be largely dependent upon the availability of such further financing. Discussions in respect to an extension of the existing banking facilities due to expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. at the end of January January: see month. 2004 were being pursued as part of the aluminium disposal process, and discussions also were taking place to replace these facilities for the medium term. As the sale is not proceeding, priority will now be given to agreeing a new three year facility from January 2004. The funding plans for the Group going forward are, therefore, an essential part of the current Board review. The Group faces the challenges of 2003 with a much more stable plant configuration following the resumption RESUMPTION. To reassume; to promise again; as, the resumption of payment of specie by the banks is general. It also signifies to take things back; as the government has resumed the possession of all the lands which have not been paid for according to the requisitions of the law, and the in January of a two blast furnace blast furnace, structure used chiefly in smelting. The principle involved in this means of extracting metals is that of the reduction of the ores by the action of carbon monoxide, i.e., the removal of oxygen from the metal oxide in order to obtain the metal. operation at Port Talbot Port Talbot (tôl`bət), town (1981 pop. 40,078), Neath Port Talbot, S Wales, at the mouth of the Avon (Afan) River on Swansea Bay. Port Talbot is a popular seaside resort. Nearby are the steelworks at Margam and the oil refinery at Baglan. , and there are no planned blast furnace outages. As to the market scene, the year has started as expected with subdued sub·due tr.v. sub·dued, sub·du·ing, sub·dues 1. To conquer and subjugate; vanquish. See Synonyms at defeat. 2. To quiet or bring under control by physical force or persuasion; make tractable. 3. demand in the UK and flat demand in mainland Mainland. 1 Island (1991 pop. 14,150), 178 sq mi (461 sq km), N Scotland. The largest of the Orkney Islands, it is also called Pomona. Kirkwall, the seat of the Orkney Islands council area, is on the island. Europe. However, despite this situation prices have improved for flat and long products, and the recent weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. of sterling against the Euro should bring some
benefits in the UK.The last eighteen months has seen a significant erosion erosion (ĭrō`zhən), general term for the processes by which the surface of the earth is constantly being worn away. The principal agents are gravity, running water, near-shore waves, ice (mostly glaciers), and wind. of global equity prices. The market value of Corus, however, has been further eroded e·rode v. e·rod·ed, e·rod·ing, e·rodes v.tr. 1. To wear (something) away by or as if by abrasion: Waves eroded the shore. 2. To eat into; corrode. by the continuing loss making situation and refinancing Refinancing An extension and/or increase in amount of existing debt. concerns together with the difficulties encountered with the proposed merger with CSN and with the divestment divestment to strip one's investment from an entity. of our aluminium business as outlined above. The Board and management are very conscious and concerned about this situation and are determined to take the necessary action to restore market confidence." Sir Brian The name Brian (sometimes spelled Bryan) comes from an Irish backround. It is of Celtic origin and its meaning may be "hill" or "strong, noble, and high"[1]. Moffat Moffat is a former burgh and spa town in Dumfries and Galloway, Scotland, lying on the River Annan, with a population of around 2,500. The most notable building in the town is the Moffat House Hotel, designed by John Adam. 14 March 2003 REVIEW OF THE PERIOD Summary of operating results Group turnover for 2002 amounted to GBP7,188m (2001: GBP7,699m) and operating costs operating costs npl → gastos mpl operacionales totalled GBP7,634m (2001: GBP8,084m), including exceptional items of GBP53m, and the Group incurred an operating loss of GBP446m (2001: GBP385m). The net loss for the year amounted to GBP458m (2001: GBP419m). The trend through 2002 saw turnover increase to GBP3,612m for the second half year from GBP3,576m for the first half. Operating costs increased from GBP3,783m for the first half year to GBP3,851m for the second half resulting in a Group operating loss of GBP239m for the second half year as compared with GBP207m for the first half. Excluding the impact of exceptional items, the Group operating loss for the year totalled GBP393m, with a reduced level of loss for the second half year which at GBP141m compared with GBP252m for the first half. Operating costs for the second half year included GBP23m in respect of transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). , principally relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the aluminium sale and the terminated merger with CSN. Year-on-year and half-yearly Half´-year`ly a. 1. Two in a year; semiannual. Adj. 1. half-yearly - occurring or payable twice each year biannual, semiannual, biyearly comparisons are discussed in more detail below in the context of 'Carbon steel', 'Aluminium' and 'Discontinued operations'. Carbon steel Turnover for the year totalled GBP6,231m (2001: GBP6,534m) and included the impact of reduced levels of distribution, further processing and other turnover which totalled GBP1,489m (2001: GBP1,742m). Product turnover for 2002 fell by 1% to GBP4,742m (2001: GBP4,792m) reflecting lower sales volume as average revenue was virtually unchanged. For the second half of 2002, product turnover of GBP2,381m was 1% above the level of the first half reflecting the net impact of a 3% rise in average revenue and a 2% fall in sales volume. In the UK, demand for Corus' main finished products during 2002 reduced to 10.65mt (2001: 10.94mt) as UK manufacturing output fell by some 4%, driven by the adverse impact of the weak global economy and the strength of sterling against the euro. Corus' sales volume in the UK totalled 5.90mt (2001: 6.15mt), of which 5.37mt (2001: 5.49mt) were main finished products. While the Group's UK market share for 2002 was, therefore, maintained at around 50%, with the share increasing to around 52% for the second half of 2002, this was against a background of a continuing downward trend in UK demand. In other European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. markets, manufacturing output also remained weak during 2002 and there was no growth in demand from steel-consuming industries within the EU, with steel consumption falling by some 1.5%. Despite this difficult market environment, Corus' sales volume in European markets (excluding UK) increased to 8.14mt (2001: 7.99mt). Sales into Europe (including the UK) accounted for over 80% of carbon steel product turnover during the past two years and have been subject to significant movements in selling prices. During 2001, European spot prices fell sharply for flat products, a trend which continued into the first quarter of 2002. From April, European carbon steel producers began to raise selling prices and there was a progressive improvement during the second half of the year, driven largely by production cutbacks by steel producers and some rebuilding of stocks by customers, despite continuing economic uncertainty and increasing concerns about the timing of any recovery. However, the continuing weakness of end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. demand was such that increases in spot prices of hot and cold rolled coil were not able to be passed on by downstream businesses to customers on a full and timely basis and, as a result of this and other factors as discussed below, trends in Corus' average revenues, particularly for flat products, do not reflect the movements in spot market prices. Outside Europe, there was a modest recovery in US demand through the first three quarters of 2002 which, combined with restrictions on imports driven by Section 201 Safeguard measures which had been implemented in March 2002, led to US prices rising sharply through to September September: see month. 2002. However, the final quarter of the year saw some weakening of demand, reflecting the faltering recovery in the US economy, at a time when both new and idled capacity was being activated activated a state of being more than usually active. In biological systems this is usually brought about by chemical or electrical means. Commonly said of pharmaceutical and chemical products. . As a consequence, the supply/demand balance in this region deteriorated towards the end of 2002. In the Asia-Pacific The term Asia-Pacific generally applies to littoral East Asia, Southeast Asia and Australasia near the Pacific Ocean, plus the states in the ocean itself (Oceania). region, steel production increased during 2002 despite persistently per·sis·tent adj. 1. Refusing to give up or let go; persevering obstinately. 2. Insistently repetitive or continuous: a persistent ringing of the telephone. 3. weak demand in Japan, as China saw continued strong growth through the year. Corus' sales volume outside Europe during 2002 totalled 2.59mt including 1.68mt in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Against the above background, average revenue for Corus' carbon steel products for 2002 was virtually unchanged at GBP285pt (2001: GBP284pt). However, this masked A state of being disabled or cut off. significant reductions in average revenues of certain downstream businesses as a result of continuing weak end-user demand. Spot price volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the is not fully reflected in Corus' average revenues as a result of such factors as contract pricing, order backlogs, exchange rate movements, and the more stable pricing of quality extras and added value Added value in financial analysis of shares is to be distinguished from value added. Used as a measure of shareholder value, calculated using the formula:
See product mix. changes, both in product and market terms, also serve to distort comparisons of spot prices and Corus' average revenues. In terms of the two half years, average revenue was GBP289pt for the second half, 3% above the level for the first half, although the weakness of end-user demand was further demonstrated with a number of Corus' downstream businesses seeing lower average revenues for the second half year. Carbon steel operating costs totalled GBP6,698m (2001: GBP6,980m) but excluding exceptional items of GBP45m were 5% lower than 2001 at GBP6,653m (2001: GBP6,970m), with the key influences being lower levels of sales, and the benefits of the Group's continuing cost and efficiency improvement measures which, in some areas, were partially offset by higher costs. The impact of lower sales arose through the combination of a reduction in sales volume of carbon steel products for 2002 to 16.62mt (2001: 16.88mt), and a fall in the level of turnover through distribution, further processing and other turnover. Carbon steel costs for 2002 were adversely affected by the impact of blast furnace outages at IJmuiden IJmuiden (īmoi`dən), city (1991 est. pop. 58,000), North Holland prov., W Netherlands, on the North Sea. It is part of the municipality of Velsen. The city is a seaport, fishing, and industrial center at the end of the North Sea Canal. and Port Talbot. Ongoing cost and efficiency improvement measures saw benefits being secured on a number of fronts through 2002. The major UK restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). programme that had been announced in 2001 was completed, in terms of site closures and re-configurations, ahead of schedule in June June: see month. 2002. Employment costs were 4% below the level of the previous year at GBP1,389m (2001: GBP1,449m), and reflected the continuing manpower productivity improvements, particularly in the UK. In the Netherlands, the Netherlands, The officially Kingdom of The Netherlands byname Holland Country, northwestern Europe. Area: 16,034 sq mi (41,528 sq km). Population (2005 est.): 16,300,000. Capital: Amsterdam. Seat of government: The Hague. Most of the people are Dutch. "World Class IJmuiden" project, which was launched in September 2001 targeting margin improvements of EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 300m (approximately GBP185m) by early-2004, had secured around two-thirds of its target by the end of 2002 through a combination of cost reduction initiatives, and sales mix and volume enhancements. In the UK, the "High Performance Strip" project was launched during 2002, with targeted benefits of GBP150m through service and cost improvements by early-2005. Aluminium Turnover for 2002 amounted to GBP957m (2001: GBP1,085m) and was 12% below the level of the previous year, with falls of 10% in total sales volume and of 2% in average revenue. Sales of primary metal were the main influence as volume was 30% below the level of 2001, and average revenue fell by 7%. For rolled products and extrusions, aggregate sales volume was virtually unchanged but turnover and average revenue for 2002 fell by 7%. This was largely a result of lower average LME See London Metal Exchange. LME See London Metal Exchange (LME). prices, which were down by 9% in 2002, and the adverse effects of the weak economic situation particularly in Europe and North America. The global slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in the aircraft market, however, had only a minor impact and was more than offset by increased sales to the automotive and heat exchanger heat exchanger Any of several devices that transfer heat from a hot to a cold fluid. In many engineering applications, one fluid needs to be heated and another cooled, a requirement economically accomplished by a heat exchanger. industries. In terms of the trend through 2002, total sales volume was 8% lower for the second half and turnover fell by 9% to GBP457m mainly due to the seasonal effects of customer shutdowns in the Summer and over Christmas Christmas [Christ's Mass], in the Christian calendar, feast of the nativity of Jesus, celebrated in Roman Catholic and Protestant Churches on Dec. 25. In liturgical importance it ranks after Easter, Pentecost, and Epiphany (Jan. 6). . Excluding the impact of exceptional items of GBP8m (2001: credit of GBP2m), operating costs amounted to GBP928m (2001: GBP1,029m) and were 10% lower than the level of the previous year, mainly reflecting the fall of 10% in overall sales volume, partially offset by an increase in employment costs. The second half of 2002 saw a 6% fall in costs to GBP449m, excluding exceptional items, largely as a result of lower overall sales volume which reduced by 8%. Against the background outlined above the operating profit for 2002, excluding exceptional items, amounted to GBP29m (2001: GBP56m), significantly below the level of the previous year and, as pressures on margins intensified in·ten·si·fy v. in·ten·si·fied, in·ten·si·fy·ing, in·ten·si·fies v.tr. 1. To make intense or more intense: during the year, the second half operating profit, excluding exceptional items, fell to GBP8m. Discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. On 22 January 2001 Avesta Avesta, city, Sweden Avesta (ä`vəstä'), city (1990 est. pop. 16,860), Kopparberg co., S central Sweden, on the Dalälven River. Aluminum and high quality steel are manufactured there. Sheffield Sheffield, city, England Sheffield, city (1991 pop. 470,685), N England, at the confluence of the Don River and four tributaries. Sheffield was one of the leading industrial cities of England. It has been a center of cutlery manufacture since the 14th cent. , the Group's 51%-owned stainless steel business, ceased to be a subsidiary of Corus. From that date, AvestaPolarit became an associated undertaking with Corus holding a 23.2% stake. On 1 July 2002, Corus announced the sale of its stake in AvestaPolarit (see 'Acquisitions and disposals' below) and consequently the stainless steel activities have been treated as discontinued operations. Exceptional items For 2002, there was a net charge of GBP53m (2001: GBP8m) in respect of exceptional items, of which GBP45m related to carbon steel activities and GBP8m related to aluminium. The net charge included a net credit of GBP45m for the first half year which mainly related to changes in cost estimates in respect of obligations for environmental and contractual liabilities for previously announced site closures and, in the second half, a net charge of GBP98m. The second half included non-cash impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges arising from the continuing losses in carbon steel operations relating to the value in use of fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → (GBP89m) and to goodwill in investments (GBP20m), the impact of which was partially offset by further releases following changes in cost estimates. Profit and loss account The Group operating loss, after exceptional items, amounted to GBP446m and translated into a total operating loss for 2002 of GBP425m after taking account of Corus' share of operating results of its associated undertakings of GBP21m, of which GBP17m related to AvestaPolarit. There was a net profit of GBP96m on disposals of fixed assets which included GBP65m in respect of the insurance settlement relating to the rebuilding of the no. 5 blast furnace at Port Talbot which took place during 2002, following an explosion in late-2001 that had made the furnace furnace, enclosed space for the burning of fuel. There are many kinds of furnaces, the type depending upon the fuel and the use to which the heat produced within it is put. Most familiar are the furnaces used in the heating of buildings. inoperable inoperable /in·op·er·a·ble/ (in-op´er-ah-b'l) not susceptible to treatment by surgery. in·op·er·a·ble adj. Unsuitable for a surgical procedure. . The balance of GBP31m mainly related to profits on sales of properties. The net profit on disposals of Group undertakings of GBP19m included a profit of GBP60m on the sale of Corus' interest in the Aluminerie Alouette smelter, which was completed in September 2002 (see 'Acquisitions and disposals' below), and a loss on disposal of GBP48m on the sale of the Group's former stainless steel interests, comprising a goodwill transfer from reserves (GBP33m) and goodwill written off (GBP15m). After taking account of net interest payable of GBP94m a loss before taxation of GBP404m was incurred. The net tax charge for the year amounted to GBP61m and included an impairment related write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of deferred tax of GBP42m. After taking account of a net credit of GBP7m for minority interests the Group incurred a net loss for the year of GBP458m. Acquisitions and disposals On 1 July 2002, Corus announced the disposal of its 23.2% stake in AvestaPolarit to Outokumpu
Outokumpu is a group of companies headquartered in Espoo, Finland, aimed at stainless steel and technology. and total proceeds amounted to EUR555m (approximately GBP356m). On 17 July 2002, Corus announced that its board and that of CSN in Brazil reached agreement in principle on the terms of a proposed merger of the two companies. However, on 13 November 2002, Corus announced that its Board had decided to terminate Terminate (terminat.exe) was a shareware modem terminal and host program for MS-DOS and compatible operating systems developed from the early to the late 1990s by the Dane Bo Bendtsen. The last release (5. the proposed transaction as a result of ongoing uncertainties in the global business environment and financial markets. On 16 August 2002, Corus announced that it has agreed to sell its 20% interest in the Aluminerie Alouette smelter to Alcan for US$165m (approximately GBP107m) in cash, with a consideration for working capital on completion. On 23 October 2002, Corus announced that it had reached agreement in principle to the sale of its aluminium rolled products and extrusions businesses to Pechiney S.A. ("Pechiney") for EUR861m (approximately GBP543m). The businesses are owned by Corus Nederland BV ("Corus Nederland") and the agreement was conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. upon internal consultation, advice and approval processes by both Corus and Pechiney. Despite the recommendation of the Management Board of Corus Nederland, the Supervisory Board of that company was not willing to give its approval. Following an unsuccessful petition to the Enterprise Section of the Amsterdam Court of Appeal for the decision of the Supervisory Board to be set aside, the sale did not proceed. As a result a break fee of EUR20m is payable by Corus to Pechiney. Additionally, Pechiney has exclusive negotiation rights over the business until 23 October 2003. In August 2002, Corus announced the acquisition of Erik Olsson Olsson is a surname, and may refer to:
In November 2002, Corus announced its intention to acquire 100% of the equity of Precoat International, one of the leading independent precoated steel service centres in the UK. Following acceptance by Precoat's shareholders and receipt of appropriate regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. consents, the cash purchase was completed on 27 December December: see month. 2002 for approximately GBP7m. In March 2002, Corus sold its stake in Galtec to Sidmar for proceeds of GBP12m. Also during 2002, the trade and assets of the Group's 25%-owned joint venture Trico Trico is an American company that specializes in windshield wipers. Trico, then Tri-Continental Corporation, invented the windshield Wiper blade in 1917. Steel, in the US were sold to Nucor Nucor Corporation (NYSE: NUE) is one of the largest steel producers in the United States, and the largest of the "mini-mill" operators (those using electric arc furnaces to melt scrap steel, as opposed to companies using traditional blast furnace technology). . Prior to this, Trico had filed for Chapter 11 protection from creditors and was fully provided against in the Group accounts for 2000. Capital expenditure Capital expenditure for the year amounted to GBP188m (2001: GBP166m). The major investment scheme, at a total capital cost of some GBP65m, was the rebuild of the Port Talbot No. 5 blast furnace which was lit on 2 January 2003. Employees Numbers employed at the end of 2002 totalled 50,900 as compared to 52,700 at the end of 2001. The net reduction of 1,800 comprised job losses related to previously announced efficiency measures. In this context, the average weekly numbers employed during the year fell by 4,000 to 51,600. Cash flow and financing The net cash inflow in·flow n. 1. The act or process of flowing in or into: an inflow of water; an inflow of information. 2. from operating activities amounted to GBP41m, the key feature being a net reduction in working capital of GBP162m which included the benefit of GBP181m from the securitisation of trade debtors. A net cash outflow from capital expenditure and financial investment of GBP57m was net of GBP112m from the sale of tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. fixed assets. There was a net cash inflow of GBP445m from acquisitions and disposals which mainly related to the sale of the Group's stake in AvestaPolarit (approximately GBP356m) and the sale of Corus' interest in the Aluminerie Alouette smelter (approximately GBP107m). After taking account of those and other movements, net borrowings reduced to GBP1,236m at the end of 2002 and represented a gearing ratio Gearing Ratio A general term describing a financial ratio that compares some form of owner's equity (or capital) to borrowed funds. Gearing is a measure of financial leverage, demonstrating the degree to which a firm's activities are funded by owner's funds versus creditor's funds. of 46% to net tangible assets Net Tangible Assets Calculated as the total assets of a company, minus any intangible assets such as goodwill, patents and trademarks, less all liabilities and the par value of preferred stock. Also known as "net asset value" or "book value". . On 11 January 2002, the Company issued EUR307m of 3% guaranteed unsubordinated bonds due 2007, convertible into shares of Corus Group plc. Almost all of the bond issue proceeds (EUR300m) and most of the funds from the securitisation of trade debtors (EUR240m) were used to pay down and cancel (character) Cancel - (CAN, Control-X) ASCII character 24. part (EUR540m) of a syndicated bank facility of EUR2,400m, which had been arranged in January 2001. The bank facility was further reduced on 30 December 2002 by voluntary cancellation cancellation (See: cancel) CANCELLATION. Its general acceptation, is the act of crossing a writing; it is used sometimes to signify the manual operation of tearing or destroying the instrument itself. Hyde v. Hyde, 1 Eq. Cas. Abr. 409; Rob. of EUR460m, of which EUR260m would have matured in January 2003 and EUR100m would have matured in March 2003. The balance of the remaining facility (EUR1,400m) matures in January 2004. The status of negotiations to replace this facility is referred to below. Going concern In the twelve month period to 28 December 2002, the Group partly met its day-to-day day-to-day adj. 1. Occurring on a routine or daily basis: the day-to-day movements of the stock market. 2. working capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. through a syndicated revolving multi-currency loan facility ('syndicated facility'). At 28 December 2002 this facility was EUR1,860m of which EUR455m was utilised. The facility was reduced following the period end, on 30 December 2002, by voluntary cancellation of EUR460m, of which EUR260m would have matured in January 2003 and EUR100m in March 2003. The facility now stands at EUR1,400m. This facility contains two financial covenants: that the Group gearing ratio (based on net tangible worth) should not exceed 75%; and, that net tangible worth should not be less than GBP2,500m. At 28 December 2002 net gearing was 46% and net tangible worth was GBP2,664m. This facility expires on 30 January 2004. On 23 October 2002 the Company announced that it had agreed in principle to the sale of its aluminium rolled products and extrusions businesses and that a definitive sale and purchase agreement would be entered into following completion of internal consultation, advice and approval processes. The Supervisory Board of Corus Nederland BV decided on 10 March 2003 to reject the recommendation to proceed with the sale, and a petition to the Enterprise Chamber of the Amsterdam Court of Appeal to set this decision aside was unsuccessful. The Group's future strategy is focused on eliminating the Group's losses in the UK. This will inevitably lead to significant further capacity reductions and concentration of operations onto fewer sites. A review by the Board is currently in progress and an announcement on its findings will be made as soon as possible. It was intended that the proceeds of the sale of the aluminium businesses would provide the capacity to finance the measures needed in the UK. However, in the light of the failure to gain approval for the sale, the Group will need to look afresh for finance from equity and debt providers and from the proceeds of disposals of non-core assets. The timing and extent of the further actions to be taken will be largely dependent upon the availability of such further financing. In parallel with the sale of aluminium, discussions were well advanced with the Group's bankers on both an extension to the existing syndicated facility and a new three year facility. Discussions will now take place with the Group's bankers on a new three year facility that will take into account the Group's operational requirements (programming) operational requirements - Qualitative and quantitative parameters that specify the desired capabilities of a system and serve as a basis for determining the operational effectiveness and suitability of a system prior to deployment. based on its business plans, revised in the light of the sale of the aluminium businesses no longer taking place, and having regard to other financing and strategic options available to the Group. In the light of the information currently available, the directors believe that it should be possible to agree new facilities with the banks that are acceptable to the Company to be available before the existing facilities expire. The financial statements have been prepared on a going concern basis, which assumes that the Group's bankers continue their support by providing new facilities acceptable to the Group to replace the existing syndicated facilities. Should the banks not support the Group in this respect, adjustments would have to be made to reduce the balance sheet values of assets to their recoverable amounts, to provide for further liabilities that might arise and to reclassify Verb 1. reclassify - classify anew, change the previous classification; "The zoologists had to reclassify the mollusks after they found new species" class, classify, sort out, assort, sort, separate - arrange or order by classes or categories; "How would you fixed assets and long term liabilities as current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. and liabilities. Whilst the directors presently cannot be certain as to the outcome of the matters mentioned above, they believe that it is appropriate for the financial statements to be prepared on a going concern basis. Accounting policies The financial statements to 28 December 2002 have been produced in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the applicable accounting standards in the UK. They also include a reconciliation of earnings and equity under US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). as set out in note 11 of "Supplementary Information" in this release. Preparation of financial statements includes the need to make assumptions and estimations that affect the amount of assets, liabilities, revenues and expenses being reported. Actual results may differ from those estimated under different assumptions and conditions. For the period under review, the most significant areas of judgement for Corus related to tangible fixed assets, deferred tax and the value of provisions created in 2000 and 2001 for redundancy Having a secondary peripheral, computer system or network device that takes over when the primary unit fails. See fault tolerant, mirroring, RAID, hot standby and backup types. 1. , rationalisation Noun 1. rationalisation - (psychiatry) a defense mechanism by which your true motivation is concealed by explaining your actions and feelings in a way that is not threatening rationalization and other related costs. There have been no new UK standards issued by the Accounting Standards Board The role of the Accounting Standards Board (ASB) is to issue accounting standards in the United Kingdom. It is recognised for that purpose under the Companies Act 1985. It took over the task of setting accounting standards from the Accounting Standards Committee (ASC) in 1990. since the last Report & Accounts. However, one standard, FRS FRS abbr. Fellow of the Royal Society FRS, n “flexed rotated side-bent,” an osteopathic abbreviation used to describe vertebral position in cases of spinal dysfunction. 17 "Retirement Benefits" which was issued in November 2000 has disclosure requirements which do not need to be met until accounting periods ending on or after 22 June 2005. The standard has not been adopted, although the required transitional disclosure requirements are being made in the Report & Accounts for 2002. Information on the net pension asset is set out in note 10 of "Supplementary Information" in this release. On 18 April 2002, Corus launched a revolving-period trade debtor One who owes a debt or the performance of an obligation to another, who is called the creditor; one who may be compelled to pay a claim or demand; anyone liable on a claim, whether due or to become due. securitisation programme in the UK. Under FRS 5 "Reporting the substance of transactions" the cash advanced has been offset against the assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. trade debtors as set out in note 7 of "Supplementary Information" in this release. Forward looking statements Statements in this release include "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " that express expectations of future events or results. All statements based on future expectations rather than on historical facts are forward-looking statements that involve a number of risks and uncertainties, and Corus cannot give assurance that such statements will prove to be correct.
CORUS GROUP plc
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
TURNOVER
Group and share of joint ventures 7,407 3,729 7,924
Less share of joint ventures' turnover (219) (153) (225)
---------- --------- ----------
GROUP TURNOVER
Continuing operations 7,188 3,576 7,619
Discontinued operations - - 80
---------- --------- ----------
7,188 3,576 7,699
---------- --------- ----------
Operating costs before exceptional items (7,581) (3,828) (8,076)
Rationalisation and impairment
exceptional items (charged)/credited
against operating costs (53) 45 (8)
---------- --------- ----------
TOTAL OPERATING COSTS (7,634) (3,783) (8,084)
---------- --------- ----------
GROUP OPERATING LOSS
Continuing operations (446) (207) (388)
Discontinued operations - - 3
---------- --------- ----------
(446) (207) (385)
SHARE OF OPERATING RESULTS OF JOINT
VENTURES AND ASSOCIATED UNDERTAKINGS
Continuing operations 4 3 10
Discontinued operations 17 16 2
---------- --------- ----------
21 19 12
---------- --------- ----------
TOTAL OPERATING LOSS (425) (188) (373)
Profit on disposal of fixed assets 96 18 17
Profit/(loss) on disposal of group
undertakings 19 (12) 2
---------- --------- ----------
LOSS BEFORE INTEREST (310) (182) (354)
NET INTEREST AND INVESTMENT INCOME
Group (92) (51) (103)
Joint ventures and associated
undertakings (2) (1) (5)
---------- --------- ----------
LOSS BEFORE TAXATION (404) (234) (462)
Taxation (61) (2) 43
---------- --------- ----------
LOSS AFTER TAXATION (465) (236) (419)
Minority Interests 7 (1) -
---------- --------- ----------
LOSS FOR FINANCIAL PERIOD (458) (237) (419)
Dividends - - -
---------- --------- ----------
LOSS RETAINED FOR THE PERIOD (458) (237) (419)
========== ========= ==========
Basic loss per ordinary share (14.65)p (7.58)p (13.42)p
---------- --------- ----------
Diluted loss per ordinary share (14.65)p (7.58)p (13.42)p
---------- --------- ----------
CORUS GROUP plc
CONSOLIDATED BALANCE SHEET
Audited Unaudited Audited
at 28 Dec at 29 June at 29 Dec
2002 2002 2001
GBPm GBPm GBPm
FIXED ASSETS
Intangible assets 105 130 135
Tangible assets 2,871 3,046 3,064
Investments in joint ventures 84 126 128
Investments in associated undertakings 7 365 358
Other investments and loans 59 62 65
-------- --------- --------
3,126 3,729 3,750
-------- --------- --------
CURRENT ASSETS
Stocks 1,337 1,332 1,320
Debtors: amounts falling due after more
than one year 457 492 468
-------- --------- --------
Debtors: amounts falling due within one
year 1,422 1,500 1,396
Less: securitisation of trade debtors (181) (185) -
-------- --------- --------
Net debtors falling due within one year 1,241 1,315 1,396
Short term investments 40 3 11
Cash at bank and in hand 230 201 173
-------- --------- --------
3,305 3,343 3,368
CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR (1,636) (1,680) (1,729)
-------- --------- --------
NET CURRENT ASSETS 1,669 1,663 1,639
-------- --------- --------
TOTAL ASSETS LESS CURRENT LIABILITIES 4,795 5,392 5,389
CREDITORS: AMOUNTS FALLING DUE
AFTER MORE THAN ONE YEAR
Convertible bonds (309) (310) (109)
Other borrowings (1,119) (1,456) (1,503)
Other creditors (36) (28) (34)
PROVISIONS FOR LIABILITIES AND CHARGES (522) (581) (576)
ACCRUALS AND DEFERRED INCOME
Regional development and other grants (40) (43) (46)
-------- --------- --------
2,769 2,974 3,121
======== ========= ========
CAPITAL AND RESERVES
Called up share capital 1,565 1,565 1,564
Share premium account 7 6 5
Statutory reserve 2,338 2,338 2,338
Other reserves 201 201 201
Profit and loss account (1,389) (1,194) (1,047)
-------- --------- --------
SHAREHOLDERS' FUNDS - EQUITY INTERESTS 2,722 2,916 3,061
MINORITY INTERESTS
Equity interests in subsidiary undertakings 47 58 60
-------- --------- --------
2,769 2,974 3,121
======== ========= ========
CORUS GROUP plc
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Loss for financial period (458) (237) (419)
Exchange translation differences on
foreign currency net investments 83 90 (58)
--------- ---------- -----------
Total recognised losses relating to
the period (375) (147) (477)
========= ========== ===========
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
Audited Unaudited Audited at
at 28 Dec at 29 June 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Shareholders' funds at beginning
of period 3,061 3,061 3,495
Loss for the period (458) (237) (419)
Exchange translation differences
on
foreign currency net investments 83 90 (58)
Transfer of goodwill 33 - 40
New shares issued 3 2 3
--------- ----------- -----------
Shareholders' funds at end of the
period 2,722 2,916 3,061
========= =========== ===========
CORUS GROUP plc
CONSOLIDATED CASH FLOW STATEMENT
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Net cash inflow/(outflow) from
operating activities 41 (6) 172
Dividends from joint ventures and
associated undertakings 8 5 9
RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE
Interest and other dividends received 15 7 16
Interest paid (97) (49) (124)
Issue costs of new loans (4) - -
Interest element of finance lease
rental payments (1) (1) (2)
--------- ---------- ----------
Net cash outflow from returns on
investments and servicing of finance (87) (43) (110)
--------- ---------- ----------
TAXATION
UK corporation tax received/(paid) 2 5 5
Overseas tax (paid)/received (16) (7) 8
--------- ---------- ----------
Tax (paid)/received (14) (2) 13
--------- ---------- ----------
CAPITAL EXPENDITURE AND FINANCIAL
INVESTMENT
Purchase of tangible fixed assets (176) (78) (167)
Sale of tangible fixed assets 112 31 37
Purchase of other fixed asset
investments (7) (7) (3)
Purchase of intangible fixed assets (1) (1) -
Loans to joint ventures and associated
undertakings - - -
Repayment of loans by joint ventures
and associated undertakings 15 14 3
--------- ---------- ----------
Net cash outflow from capital
expenditure and financial investment (57) (41) (130)
--------- ---------- ----------
ACQUISITIONS AND DISPOSALS
Net overdraft acquired with subsidiary
undertakings and businesses (5) (1) -
Investments in joint ventures and
associated undertakings (3) (2) (12)
Sale and exchange of businesses and
subsidiary undertakings 2 2 52
Sale of joint ventures and associated
undertakings 451 (1) 9
--------- ---------- ----------
Net cash inflow/(outflow)from
acquisitions and disposals 445 (2) 49
--------- ---------- ----------
CORUS GROUP plc
CONSOLIDATED CASH FLOW STATEMENT, continued
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Equity dividends paid to shareholders - - -
--------- ----------- -----------
Net cash inflow/(outflow) before use
of liquid resources and financing 336 (89) 3
--------- ----------- -----------
Management of liquid resources:
Net (purchase)/sale of short term
investments (28) 8 27
FINANCING
Issue of ordinary shares 3 2 -
--------- ----------- -----------
Cash inflow from issue of ordinary
shares 3 2 -
--------- ----------- -----------
New loans 231 186 282
Repayment of borrowings (508) (71) (333)
New finance lease 25 - -
Capital element of finance lease
rental payments (14) (3) (9)
--------- ----------- -----------
(Decrease)/increase in debt (266) 112 (60)
--------- ----------- -----------
Net cash (outflow)/inflow from
financing activities (263) 114 (60)
--------- ----------- -----------
INCREASE/(DECREASE) IN CASH IN PERIOD 45 33 (30)
CORUS GROUP plc
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Increase/(decrease) in cash 45 33 (30)
Increase/(decrease) in liquid
resources 28 (8) (27)
Decrease/(increase) in debt 266 (112) 60
Issue costs of new loans 4 - -
--------- ----------- ----------
Change in net funds resulting from
cash flows in period 343 (87) 3
Debt and liquid resources
(acquired)/exchanged/disposed of (4) - 103
Effect of foreign exchange rate
changes (24) (33) 10
Other non cash items 9 - -
--------- ----------- ----------
Movement during the period 324 (120) 116
Net debt at beginning of the period (1,560) (1,560) (1,676)
--------- ----------- ----------
Net debt at end of the period (1,236) (1,680) (1,560)
========= =========== ==========
ANALYSIS OF NET BORROWINGS
Audited Unaudited Audited
at 28 Dec at 29 June at 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Cash at bank and in hand 230 201 173
Bank overdrafts (36) (20) (27)
Short term investments 40 3 11
Other short term loans (41) (94) (101)
Long term borrowings (1,386) (1,742) (1,586)
Obligations under finance leases (43) (28) (30)
---------- ---------- ----------
(1,236) (1,680) (1,560)
========== ========== ==========
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
1. Turnover & operating result Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
SEGMENTAL TURNOVER
Carbon steel products 4,742 2,361 4,792
Distribution & further processing 1,236 602 1,433
Other turnover 253 113 309
--------- ---------- -----------
Carbon steel 6,231 3,076 6,534
Aluminium 957 500 1,085
Discontinued operations - - 80
--------- ---------- -----------
Group turnover 7,188 3,576 7,699
========= ========== ===========
BY DESTINATION
UK 2,071 1,046 2,291
Europe (excluding UK) 3,658 1,817 3,899
North America 881 435 889
Other areas 578 278 620
--------- ---------- -----------
7,188 3,576 7,699
========= ========== ===========
PRODUCT TURNOVER
Carbon steel products:
UK 1,643 830 1,737
Europe (excluding UK) 2,283 1,134 2,258
North America 548 261 504
Other areas 268 136 293
--------- ---------- -----------
4,742 2,361 4,792
========= ========== ===========
Aluminium (*):
UK 87 45 104
Europe (excluding UK) 634 335 737
North America 165 85 171
Other areas 71 35 73
--------- ---------- -----------
957 500 1,085
========= ========== ===========
(*): comprising:
Primary metal 123 68 189
Rolled products 633 331 683
Extrusions 201 101 213
--------- ---------- -----------
957 500 1,085
========= ========== ===========
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GROUP OPERATING RESULT GBPm GBPm GBPm
(before exceptional items)
Carbon steel (422) (273) (436)
Aluminium 29 21 56
Discontinued operations - - 3
------------- ---------- -----------
(393) (252) (377)
============= ========== ===========
GROUP OPERATING RESULT GBPm GBPm GBPm
(after exceptional items)
Carbon steel (467) (228) (446)
Aluminium 21 21 58
Discontinued operations - - 3
------------- ---------- -----------
(446) (207) (385)
============= ========== ===========
2. Sales volume kt kt kt
Carbon steel products:
UK 5,896 2,989 6,146
Europe (excluding UK) 8,138 4,130 7,994
North America 1,677 811 1,573
Other areas 910 457 1,163
------------- ---------- -----------
16,621 8,387 16,876
============= ========== ===========
Aluminium(*):
UK 62 32 78
Europe (excluding UK) 373 195 429
North America 96 48 78
Other areas 29 16 36
------------- ---------- -----------
560 291 621
============= ========== ===========
(*): comprising:
Primary metal 147 77 210
Rolled products 324 168 320
Extrusions 89 46 91
------------- ---------- -----------
560 291 621
============= ========== ===========
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
3. Total operating costs
Raw materials & consumables 3,339 1,634 3,539
Maintenance costs
(excluding own labour) 682 378 706
Other external charges 1,209 628 1,272
Employment costs 1,568 789 1,633
Depreciation & amortisation
(net of grants released) 445 161 376
Other operating costs 436 197 543
Changes in stock (34) 1 61
Own work capitalised (11) (5) (46)
--------- ---------- -----------
7,634 3,783 8,084
========= ========== ===========
4. Exceptional items
As included in total operating
costs:
- Redundancy & related costs (14) (3) (9)
- Accelerated depreciation 82 (11) 5
- Acclererated amortisation 23 - -
- Other asset write-downs (3) (1) (13)
- Other rationalisation costs (35) (30) 25
--------- ---------- -----------
53 (45) 8
========= ========== ===========
5. Net interest &
investment income
Interest receivable 17 7 15
Interest payable (108) (57) (116)
Finance leases (1) (1) (2)
--------- ---------- -----------
Group (92) (51) (103)
Joint ventures & associated
undertakings (2) (1) (5)
--------- ---------- -----------
(94) (52) (108)
========= ========== ===========
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
6. Taxation GBPm GBPm GBPm
UK corporation tax 2 2 25
Double tax relief (2) (2) (25)
UK prior year (credit)/charge (3) 4 1
Overseas prior year
charge/(credit) 19 - (7)
Overseas taxes 15 (9) 28
---------- ----------- -----------
Current tax 31 (5) 22
UK deferred tax 40 - (58)
Overseas deferred tax (16) 2 (12)
---------- ----------- -----------
Group tax 55 (3) (48)
Joint ventures 2 1 3
Associated undertakings 4 4 2
---------- ----------- -----------
61 2 (43)
========== =========== ===========
Deferred tax is accounted for under FRS 19 'Deferred Tax', which
was adopted by the Group from 1 January 2001. Deferred tax
assets amounting to GBP137m have been recognised. The deferred
tax assets in respect of tax losses are recoverable against
future forecast taxable profits within a time horizon that the
directors consider to be more likely than not to occur. Deferred
tax assets have not been recognised in respect of losses with a
value of GBP1,390m, of which GBP831m are UK losses.
7. Securitisation of trade debtors GBPm GBPm GBPm
Securitised gross trade
debtors 293 315 -
Less non-returnable proceeds (181) (185) -
---------- ----------- -----------
Net securitised trade debtors 112 130 -
Other trade debtors 883 940 -
---------- ----------- -----------
Total trade debtors 995 1,070 -
========== =========== ===========
8. Reconciliation of operating
result to net cash GBPm GBPm GBPm
flow from operating activities
Operating loss (446) (207) (385)
Depreciation & amortisation
(net of grants released) 445 161 376
Exceptional items (excluding
accelerated depreciation) (52) (34) 3
Utilisation of provisions (57) (27) (137)
Decrease/(increase) in stocks 27 22 41
Decrease/(increase) in debtors 218 81 177
(Decrease)/increase in creditors (83) (2) 91
Other movements (net) (11) - 6
---------- ----------- -----------
41 (6) 172
========== =========== ===========
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
9. Employees number number number
Average weekly numbers employed:
UK 25,900 26,300 28,800
Netherlands 11,900 12,000 12,400
Other countries 13,800 13,800 14,400
--------- ---------- -----------
51,600 52,100 55,600
========= ========== ===========
Numbers employed at end of
period:
UK 25,400 25,800 26,700
Netherlands 11,800 11,900 12,200
Other countries 13,700 13,900 13,800
--------- ---------- -----------
50,900 51,600 52,700
========= ========== ===========
10. Pensions GBPm GBPm GBPm
As measured in accordance with the UK
requirements of FRS17:
Total market value of assets 10,395 11,048 11,255
Present value of scheme liabilities (10,307) (9,685) (9,502)
-------- ------- -------
Surplus in the scheme 88 1,363 1,753
Non-recoverable surplus - (222) (503)
-------- ------- -------
Recoverable surplus 88 1,141 1,250
Related deferred tax liability (20) (351) (385)
-------- ------- -------
Net pension asset 68 790 865
======== ======= =======
CORUS GROUP plc
SUPPLEMENTARY INFORMATION
11. US GAAP Audited Unaudited Audited
12 months 6 months 12 months
to 28 Dec to 29 June to 29 Dec
2002 2002 2001
GBPm GBPm GBPm
Loss for the period (458) (237) (419)
Adjustments:
Amortisation of goodwill 9 6 (5)
Impairment of US GAAP goodwill on
adoption of SFAS 142 (net of
release of negative goodwill) (22) (22) -
Depreciation of fixed assets - - 5
Profit/(loss) on sale of associated
undertaking/subsidiary 123 15 (202)
Interest costs capitalised 6 4 8
Depreciation of capitalised interest (18) (9) (16)
Pension costs 95 60 100
Stock-based employee
compensation awards (15) (8) (9)
Accelerated depreciation (151) (8) (21)
Profit on disposal of fixed assets (23) - -
Deferred taxation 29 (18) 18
Profit/(loss) on commodity
derivatives 22 25 (25)
Profit/(loss) on foreign currency
derivatives 5 (3) (4)
--------- ----------- ----------
Loss for the period - US GAAP (398) (195) (570)
========= =========== ==========
Basic loss per ADS - US GAAP GBP(1.27) GBP(0.62) GBP(1.83)
========= =========== ==========
Diluted loss per ADS - US GAAP GBP(1.27) GBP(0.62) GBP(1.83)
========= =========== ==========
Shareholders' equity 2,722 2,916 3,061
Adjustments:
Additional goodwill under US GAAP 6 3 99
UK GAAP goodwill on AvestaPolarit - (75) (93)
Fixed assets - - (77)
Purchase consideration (26) (26) (26)
Interest costs capitalised
(net of depreciation) 111 114 119
Pension costs 286 302 242
Accelerated depreciation 155 298 306
Deferred taxation (129) (196) (178)
Liabilities for derivatives (2) (7) (29)
Deferred profits on fixed asset
disposals (23) - -
--------- ----------- ----------
Shareholders' equity - US GAAP 3,100 3,329 3,424
========= =========== ==========
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