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PEEL PORTS SHAREHOLDER FINANCECO LIMITED
Report and Financial Statements
For the year ended 31 March 2011
Company Regtstratmn No 5965116
A51 19/1212011
COMPANIES HOUSE #183
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
REPORT AND FINANCIAL STATEMENTS 2011
CONTENTS
Officers and professional adv1sers
Directors' report
D~rectors' responsibilities statement
Independent auditor's report
Consolidated profit and loss account
Consolidated statement of total recognised gains and losses
Reconciliation of movements m Group shareholder's deficit
Balance sheets
Consolidated cash flow statement
Reconciliation of Group cash flows to movement in net debt
Notes to the financial statements
Page
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PEEL PORTS SHAREHOLDER FINANCECO LIMITED
OFFICERS AND PROFESSIONAL ADVISERS
DIRECTORS
TEAlhson P J Hosker H M M Mackenzie J B McCarthy J Whlltaker (Chairman) M Whitworth
SECRETARY
C R Marnson Gill
REGISTERED OFFICE
Marihme Centre Port of Liverpool Liverpool L21 lLA
BANKERS
The Royal Bank of Scotland PLC/ Nahonal Weshnmster Bank PLC 22 Castle Street Liverpool L20UP
AUDITOR
Delmtte LLP Chartered Accountants and Statutory Auditor Liverpool Umted Kmgdom
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
DIRECTORS' REPORT
The directors present their report and the audited financial statements of the Company and the Group for the year ended 3 I March 20 I I
PRINCIPAL ACTIVITIES
The Company acts as an mtermedmte holdmg company w1thm the Peel Ports Holdmgs (Cl) Lumted group of companies
The pnnc1pal activities of the Group are the provision of port facilities and cargo handlmg and marme related services together With the operatiOn of sh1ppmg and freight forwardmg busmesses. The subsidianes and jomt ventures pnnc1pally affectmg the profits or net assets of the Group m the year are hsted m note 34 to the fmancial statements
RESULTS AND DIVIDENDS
The results for the year and the Group's financial position at the end of the year are shown m the fmanc1al statements, and are discussed further m the busmess review below
The directors proposed and paid mterun dividends of £23,000,000 (20 I 0 £24,000,000) No fmal dlVldend IS proposed (2010 £ml)
SUBSEQUENT EVENTS
On 27 May 2011 the Group acqmred the De Facto 1693 Limited group of companies from RREEF Pan European Infrastructure Two Lux S a r I and Peel Land (No 2) Limited for cash consideratiOn of£ 14 million The De Facto 1693 group owns property m Hebbum, Tyne and Wear, and Falmouth, Cornwall, which 11 leases to third parties The acquiSitiOn was financed by a £11 million loan from the Company's Immediate parent undertakmg, Peel Ports Holdmgs (Cl) Lun1ted, and new loan notes of£ I 5m each Issued by the Company to the two mvestor companies m Peel Ports Holdmgs (Cl) Limited
REVIEW OF BUSINESS, DEVELOPMENTS AND PROSPECTS
Summary of results
The results for the year and the previous year, are summonsed m the table below
Contmumg OperatiOns: 2011 2010 £'000 £'000
Turnover 358,899 362,469
Gross profit l19,054 l14,066
EBITDAI 130,223 121,141
Group operatmg profit 76,833 65,129
Change £'000 %
(3,570) (I 0)
4,988 44
9,082 75
I I, 704 18 0
The Group's results and financial position are set out m the consolidated profit and loss account and balance sheets respectively
Turnover for the year ended 31 March 20 I 0 m eludes £5,635,000 arismg from the substantial completiOn of services provided under the terms of ex1stmg contractual arrangements The directors consider that no further obligatiOns anse given that all services have been rendered and the likelihood of future remstatement of activities IS remote
Durmg the year, the Group d1scontmued the mtematmnal sh1ppmg services of Its subsidiary, Seawmg Landguard Internatwnal Limited ("Seawmg"), havmg closed Its fre1ght-forwardmg busmess m the year ended 31 March 2010 Turnover for this subsidiary was £4,487,000 (2010 £15,938,000) with a profit before tax of £507,000 (2010 loss of £I, 764,000) Although this subsidiary has ceased tradmg, It does not meet the defmii!on of a d1scontmued segment for the purposes of presentation m the profit and loss account
1 EBITDA IS total operatmg profit before depreciatiOn, amortisation, grant mcome and operatmg exceptional Items, and after other finance mcome ar1smg from the penswn asset and after mmonty mterests
2
' PEEL PORTS SHAREHOLDER FINANCECO LIMITED
DIRECTORS' REPORT (CONTINUED)
Net habthttes were £449,355,000 at 31 March 2011 (2010 £434,838,000) In addttton to the profit for the fmanctal year of £3,459,000 (2010 £2,055,000), the net defictt posttton has changed pnmanly because of an actuartal gaiD, net oftax, relatiDg to the Group's defined benefit penston schemes of £4,902,000 (2010 loss of £9,663,000) and the payment of mtenm divtdends on ordiDary shares of £23,000,000 (20 I 0 £24,000,000)
Detatls of operatmg and non-operatmg excepttonalttems can be found m notes 6, 7 and 8
Summary of key performance mdtcators
The dtrectors use dtvtstonal armual budgets aggregated IDto a Group budget as the basts for measurmg Group perfonnance In addttton, the Group prepares three year rollmg forecasts and a five year strategtc plan from a parttctpattve process
The dtrectors momtor the progress of the overall Group strategy and the mdtvtdual strategtc elements by reference to certaiD financtal and non-financtal key perfonnance mdtcators for the contmuiDg busmess operattons
Absolute % 2011 2010 Change Change Method of calculation
Year on year change ID Turnover (£'000) 358,899 362,469 (3,570) (I 0) turnover
Ralto of gross profit to turnover expressed as a
Gross profit margiD 33 2% 31 5% 1 7% 54 percentage Trade debtors net of
Investment m trade debtors as prOVISIOns as a percentage of a percentage of turnover 13 5% 147% (I 2%) (8 2) turnover
Turnover dtvtded by average Turnover per employee (£'000) 304 9 2709 34 0 12 6 number of employees
Tonnage throughput • Year on year change ID UK Ports· (SHA)• (mtlhons) 57 0 509 6 I 12 0 tonnage usiDg standard Insh Tennmals (mtlhons) 26 27 (0 I) (3 7) tonnage measures for the Shtpp1Dg {mtlhons) 27 24 03 12 5 Ports IDdustry
•statutory Harbour Authonty
As referred to above, turnover for the year ended 31 March 2010 benefitted from the recogmtton of revenue of £5,635,000 under contractual arrangements where no further obhgattons extst In addttton, the Group dtscontiDued the mternaltonal shtppmg servtces ofSeawmg, whtch contrtbuted £4,487,000 (2010 £15,938,000) to turnover ID the year
The year on year changes ID key performance IDdtcators dtsclosed above for turnover, IDVestrnent ID trade debtors and turnover per employee are based on turnover as recorded m the profit and loss account ExcludiDg the effects of the closure of Seawmg, turnover and tonnage throughput have IDcreased year on year, whtch reflects the recovery ID the wtder global economy and Improvements ID market share Htgher volumes, better sales mtx and the reahsed benefits of the Group's restructurmg exerctses resulted ID tmproved gross rnargm and operaltonal effictency Contmued focus on the colleclton of trade debtors has seen a year on year decrease ID the IDvestment ID trade debtors as a percentage of turnover
3
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
DIRECTORS' REPORT (CONTINUED)
Port operatiOns
The level of busmess activity for the port operations has been satisfactory m the current economic climate It IS anticipated that the present level of activity will Improve over the next 12 months
PRINCIPAL RISKS AND UNCERTAINTIES
It IS now Widely understood that the pnnc1pal challenges facmg UK busmesses relate to those generated by the global economic downturn The resultmg lack of hqmd1ty m the financial markets reduced the ab1hty of mdividuals and busmesses to borrow money and this ultimately led to a lack of demand m the global marketplace Although economic recovery appears to be m progress, the outlook remams uncertam
Peel Ports Shareholder FmanceCo Limited and Its subs1d1anes operate as the Statutory Harbour Authonty for the Port of Liverpool, the Manchester Ship Canal, the River Medway, the Clydeport area, Ardrossan Harbour, Twelve Quays at B1rkenhead Docks and Heysham Port They also provide port facilities, freight forwardmg and cargo handling services m Glasgow, Greenock, Hunterston, Dublm and Belfast Sh1ppmg and transport services to the UK, the Republic of Ireland and Europe are provided by the sh1ppmg and freight forwardmg subs1dmnes
Despite the contmumg uncertamty m the global economic environment, the results for the year have Improved, which IS largely attributed to the benefit of a strong and diverse portfolio of customers and service provision Although several European ports have been hit by the global decline m contamer volumes, Peel Ports Group IS not as reliant on contamer handling as many other port busmesses With Its strong and diverse service offenng, the Group contmues to show greater rest hence m the current environment
Operatwnal nsks
The regwnal ports with m the Group each form part of a wider transport mfrastructure The key operational nsk and uncertamty relates to the dependency upon the economic activity of the busmesses and consumers w1thm an economic geographic proxumty of the ports These consumers and busmesses generate the trade which flows through the ports and when they are subJect to economic cycles or, at the extreme, to failure there IS an unavOidable Impact on the port
The mitigation ofth1s nsk comes from the wide and diverse nature of customers, markets and products served by the ports This has the effect of mimmismg the Impact of a particular cycle or busmess failure and mdeed one trade can hedge agamst another
In additiOn, the nature of the ports mdustl)' IS such that the work undertaken reqmres employees and contractors to be totally aware of their workmg environment as there IS always the posSibility of accidents occurrmg Some of the cargoes which are handled are dangerous and need to be handled m accordance with specific procedures The Group has emergency plans m place which are reviewed and updated where necessary In additiOn, trammg and safety gmdance IS provided to all employees and contractors workmg m the ports
Fmancw/ nsks
The key financial nsk anses from the level of long term debt held by the Peel Ports Shareholder FmanceCo Limited Group ("Group") and the mterest ansmg !hereon The Group's long term debt, amountmg to £1,182,679,000, falls due for repayment between 31 December 2013 and 30 September 2046 In addition the cash flow nsk ar1smg m connectiOn with mterest charges IS mitigated through the use of mterest swaps Further details on this can be found m note I9
The directors consider that the combmatwn of the swap mstruments, stable tradmg of the ports bus mess, effective workmg capital management and the m vestment m the asset base assists m managmg the nsks ar1smg from the level of debt and vanab1 lity m mterest rates
The Group's bank loans and swap mstruments are spread over a large number of banks and w1thm the current facility agreement there are undrawn funds available
4
• PEEL PORTS SHAREHOLDER FINANCECO LIMITED
DIRECTORS' REPORT (CONTINUED)
The Group IS exposed to translatiOn and transactiOn foreign exchange nsk Transaction exposures, mcludmg those associated w1th forecast transactions, are hedged when known The Group manages Its foreign exchange exposure on a net bas1s, and, 1f requrred, uses forward foreign exchange contracts and financial mstruments to reduce the exposure If the hedgmg actiVIty does not mitigate the exposure, then the results and the financial condltlon of the Group may be adversely Impacted by foreign currency fluctuatiOns Whilst the a1m IS to achieve an economic hedge, the Group does not adopt an accounting pohcy of hedge accountmg for these fmanc1al statements The Group reviews Its exposure to translation nsk ansmg from Its overseas mvestlments on a contmual basis and wdl enter mto hedges 1f considered necessary
The Group operates defined benefit pensiOn schemes and 1s party to a number of mdustry-w1de defined benefit schemes Modest changes to the assumptions used to value the schemes' assets and hab1hties can have a s1gmficant effect on the asset or hab1hty that the Group records The schemes and the assumptions used are more fully explamed m note 23 of the fmanc1al statements, together with an md1catwn of the sensitiVIty of amounts recorded to changes m assumptions The Group manages Its responsibihlles with regard to Its defined benefit scheme arrangements by agreemg contnbutwn rates w1th the trustees of those schemes to enable defiCits to be recovered over appropnate penods of time At 31 March 2011, the Group balance sheet recorded a pensiOn asset, net of deferred taxatiOn, of£16,081,000 (2010 £5,799,000) The year on year mcrease IS pnmanly as a result ofh1gher asset values
As permitted by FRS!? 'Retrrement benefits', the Pilots NatiOnal PensiOn Fund ("PNPF"), an mdustry-w1de defined benefit scheme, IS accounted for as If the scheme was a defined contnbutwn scheme Whilst the directors consider 11 hkely that the Group will be requued to fund a share of the deficit of the PNPF, they are currently unable to determme the quantum of any deficit ar1smg or the share to be borne by the Group until such lime as legal proceedmgs bemg brought by third parties agamst the trustee of the PNPF are resolved, formal actuarial valuallons performed, agreement bemg reached on the basis on wh1ch any deficit will be shared between the partiCipatmg competent harbour authont1es and a recovery plan IS agreed Furthermore, the trustee has md1cated 11 will not engage with the participatmg competent harbour authonlles m relation to determmmg the quantum of any deficit and the recovery thereof until the appeal process IS determmed A key Issue of the appeal process concerns the Judgment as to the respons1b1hty of competent harbour authonlles with self employed p1lots to contribute to the scheme deficit As explamed m note 23, m 2006 the partiCipatmg bodies for the PNPF agreed a voluntary arrangement to mcrease contributions m order to reduce the defiCit The directors agreed to make voluntary contributiOns totalling £3,524,000 payable m mstalments over a 5 year penod In the year ended 31 March 2008, the pensiOn fund trustee mitiated legal proceedmgs agamst all participatmg competent harbour authonlles as a means to obtam further contributions to fund the deficit Although th1s voluntary payment plan has lapsed, the provision retamed by the Group as at 31 March 2011 amounted to £2,029,000 (20 I 0 £2,029,000)
Fmancial nsk also arises from credit extended to customers This nsk IS mitigated by usmg strict credit control procedures, the unposltlon of appropnate credit hm1ts and obtammg thud party credit references
Gomg concern
As referred to m note I to the financial statements, the duectors have a reasonable expectatiOn that the Company has adequate resources to contmue m operational existence for the foreseeable future and for this reason they contmue to adopt the gomg concern basis of accountmg m prepanng the annual financial statements
DIRECTORS
The directors who held office dunng the financial year and thereafter, except as noted, were as follows
J Wh1ttaker (Chairman) TE Alhson AABarr S R Baxter P J Hosker H M Mackenzie J B McCarthy M Wh1tworth
(resigned 9 May 2011) (resigned 24 June 20 I 0)
(appomted 30 June 2011) {appomted 30 June 2011) (appomted 30 June 2011)
5
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
EMPLOYEES
The Group considers that employee mvolvement 1s essenllal to the contmmng development and success of Its busmess and uses a vanety of methods to mform, consult and mvolve Its employees The pnmary commumcat1on channels for employees are w1thm the Group's operatmg umts
Apphcatwns for employment by disabled persons are given full cons1deratwn, havmg regard to the capabiiiiles of the applicant In the event of employees becommg disabled, every effort 1s made to provide them w1th employment m the Group and to arrange any necessary re-trammg It 1s the pohcy of the Group that the trammg, career development and promotiOn of disabled persons should, as far as possible, be Identical to that of a person who does not suffer from any disability Appropnate access and faciiiiles are also provided for any disabled employees as required Trammg programmes are m place to ensure that the Group has suitably qualified mdiVIduals to undertake the various operatiOnal tasks w1thm the Group
CHARITABLE AND POLITICAL CONTRIBUTIONS
Dunng the year, contributiOns by the Group for chantable purposes totalled £81 ,000 (20 I 0 £80,000) The Group made no poht1cal contnbutwns durmg the fmanc1al year (20 I 0 £ml)
ENVIRONMENT
The Group IS conscious of the Impact of Its operations on the environment Necessary attentiOn IS g1ven to environmental Issues particularly when developmg new proJects, refurbiShing ex1stmg properties and cons1dermg possible acquisitiOns Design consultants are encouraged to promote good environmental performance with consideratiOn given to environmental nsk, energy consumptiOn, the use of environmentally friendly matenals and the avOidance of matenals hazardous to health
AUDITOR AND THE DISCLOSURE OF INFORMATION TO THE AUDITOR
Each person who IS a director ofthe Company at the date of approval ofth1s report confirms that
• so far as the director IS aware, there IS no relevant audit mformatwn of wh1ch the Company's auditor IS unaware, and
• the director has taken all the steps that he/she ought to have taken as a director to make himself/herself aware of any relevant audit m formatiOn and to establish that the Company's auditor IS aware of that m formatiOn
Th1s confirmatiOn IS g1ven and should be mterpreted m accordance with the provisions of s418 of the Compames Act 2006
Delmtte LLP have md1cated their willingness to be reappomted for another term and appropnate arrangements have been put m place for them to be deemed reappomted as auditors m the absence of an Annual General Meetmg
On behalf of the Board
M Wh1tworth Director 28 July 2011
6
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
The d1rectors are respons1ble for prepanng the Annual Report and the financ1al statements m accordance w1th applicable law and regulations
Company law reqmres the directors to prepare financ.al statements for each financ.al year Under that law the d1rectors have elected to prepare the financ.al statements m accordance w1th Umted Kmgdom Generally Accepted Accountmg Practice (Umted Kmgdom Accounting Standards and applicable law) Under company law the d1rectors must not approve the financ1al statements unless they are satisfied that they g1ve a true and falf v1ew of the state of affa1rs of the Company and of the profit or loss of the Company for that penod In preparmg these financ1al statements, the directors are reqmred to
• select suitable accountmg pollc1es and then apply them consistently, • make judgments and accountmg estimates that are reasonable and prudent, • state whether applicable UK Accountmg Standards have been followed, subject to any matenal departures
d1sclosed and explamed m the financ1al statements, and • prepare the financ1al statements on the gomg concern bas1s unless 1t 1s mappropnate to presume that the
Company w1ll contmue m busmess
The d1rectors are respons1ble for keepmg adequate accountmg records that are suflic1ent to show and explam the Company's transactions and d1sclose w1th reasonable accuracy at any lime the financ1al pos1t1on of the Company and enable them to ensure that the financ.al statements comply w1th the Compames Act 2006 They are also responsible for safeguardmg the assets of the Company and hence for takmg reasonable steps for the prevention and detection of fraud and other megular111es
7
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PEEL PORTS SHAREHOLDER FINANCECO LIMITED
We have audtted the financJal statements of Peel Ports Shareholder FmanceCo Ltmned for the year ended 31 March 2011 whtch compnse the consohdated profit and loss account, the consohdated statement of total recogmsed gams and losses, the reconcthalton of movements m group shareholder's defictt, the group and parent company balance sheets, the consohdated cash flow, the reconcthatwn of group cash flows to movement m net debt and the related notes I to 34 The financtal reportmg framework that has been apphed m thetr preparatton ts apphcable law and United Kmgdom Accountmg Standards {Untied Kmgdom Generally Accepted Accountmg Practtce)
Thts report ts made solely to the Company's members, as a body, m accordance wnh Chapter 3 of Part 16 of the Compames Act 2006 Our audtt work has been undertaken so that we mtght state to the Company's members those matters we are reqUired to state to them m an audttor's report and for no other purpose To the fullest extent permttted by law, we do not accept or assume responstbthty to anyone other than the Company and the Company's members as a body, for our audtt work, for thts report, or for the optmons we have formed
Respecttve responstbthhes of dtrectors and audttor
As explamed more fully m the Dtrectors' Responstbthttes Statement, the dtrectors are responstble for the preparatton of the financtal statements and for bemg sattsfied that they gtve a true and fatr vtew Our responstbthty ts to audu and express an opmton on the financial statements m accordance wuh apphcable law and lntematJOnal Standards on Audttmg (UK and Ireland) Those standards reqUJre us to comply wuh the Audttmg Practtces Board's Ethtcal Standards for AudJtors
Scope of the audtt of the financtal statements
An audtt mvolves obtammg evtdence about the amounts and dtsclosures m the financtal statements suffictent to gtve reasonable assurance that the financtal statements are tree from matenal mtsstatement, whether caused by fraud or error Thts mcludes an assessment of whether the accountmg pohctes are appropnate to the Group's and the parent Company's ctrcumstances and have been conststently apphed and adequately dtsclosed, the reasonableness of stgntficant accountmg esttmates made by the dtrectors, and the overall presentation of the financtal statements In addttJOn, we read all the financtal and non-financtal mformat10n m the annual report to tdenttfy matenal mconsJstenc1es w1th the audtted financml statements If we become aware of any apparent matenal misstatements or mcons1stenctes we cons1der the lmphcatJOns for our report
Opm10n on financial statements
In our opm10n the financml statements
• gtve a true and fatr vtew of the state of the Group's and the Parent Company's affatrs as at 31 March 2011 and of the Group's profit for the year then ended,
• have been properly prepared m accordance wtth Untied Kmgdom Generally Accepted Accountmg Practtce, and
• have been prepared m accordance wtth the reqUirements of the Compames Act 2006
Opmton on other matter prescnbed by the Compames Act 2006
In our opm10n the mformatton gtven m the dtrectors' report for the financtal year for whtch the financtal statements are prepared IS consistent w1th the financ1al statements
Matters on whtch we are requtred to report by exceptton
We have nothmg to report m respect of the followmg matters where the Compames Act 2006 requtres us to report to you 1f, m our optmon • adequate accountmg records have not been kept by the Parent Company, or returns adequate for our audn
have not been recetved from branches not vtstted by us, or • the Parent Company financtal statements are not m agreement with the accountmg records and returns, or • certam disclosures ofdtrectors' remuneratiOn specified by law are not made, or • we have not received all the m formatiOn and explanations we requ1re for our aud1t
Patnck Loftus BSc ACA (Semor Statutory Audttor) for and on behalfofDeloiJte LLP Chartered Accountants and Statutory Auditor Ltverpool, Umted Kmgdom 23 July 2011
8
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
CONSOLIDATED PROFIT AND LOSS ACCOUNT For the year ended 31 March 2011
GROUP TURNOVER
GROUP OPERATING PROFIT Share of operatmg profit of JOmt ventures
TOTAL OPERATING PROFIT: GROUP AND SHARE OF JOINT VENTURES
Profit/(loss) on dosposal of mterests m - Subsodoary undertakmgs - Jomt ventures - Foxed asset mvestments
Non-operatmg excepllonalotem Net mterest and somolar otems
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION Tax on profit on ordmary actovotoes
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION Equoty mmonty mterests
PROFIT FOR THE FINANCIAL YEAR
The above results are denved from contmumg operatoons
Note
2
2,3 2
7 7 7 8 9
10
32
22
2011 £'000
358,899
76,833 3,468
80,301
776
(82)
(69,681)
11,314 (7,734)
3,580 (121)
3,459
2010 £'000
362,469
65,129 4,624
69,753
(448) 1,917
164 (59,813)
11,573 {9,611)
1,962 93
2,055
The Group's turnover os stated nel of turnover for JOIDt ventures and the Group's reported net mterest payable and taxatoon mclude the Group's share of JOmt ventures' net mterest payable and taxatwn These are not matenal to the Group and accordmgly are separately dosclosed m the notes to the financoal statements
9
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES For the year ended 31 March 2011
Profit for the financial year -Group profit/(loss) - Jomt ventures profit
Other recognised gams and losses Currency translation differences on foreign net m vestments Actuanal gam/(loss) relatmg to the Group pensmn schemes Movement on taxation relatmg to pensmn surplus -Deferred -Current Actuanal gaml(loss) net of deferred taxation relatmg to
JOmt venture penston schemes
Total recogmsed gams and losses for the financial year
Note
23
2011 £'000
902 2,557
3,459
(209) 6,624
(1,722)
146
4,839
8,298
2010 £'000
(1,299) 3,354
2,055
(178) (13,228)
2,914 651
(439)
(10,280)
(8,225)
RECONCILIATION OF MOVEMENTS IN GROUP SHAREHOLDER'S DEFICIT For the year ended 31 March 2011
Profit for the fmancial year Dividends (note 11) Other recognised net gams and losses for the fmancial year Net change m shareholder's deficit Opening shareholder's deficit Closing shareholder's deficit
2011 2010 £'000 £'000
3,459 (23,000)
4,839 (14,702)
(435,139) (449,841)
2,055 (24,000) (10,280) (32,225)
(402,914) (435,139)
10
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
BALANCE SHEETS As at 31 March 2011
Group Company lOll 2010 2011 2010
Note £'000 £'000 £'000 £'000 FIXED ASSETS Intangtble assets 12 146,140 156,245 Tangtble assets 13 712,500 718,542 Interests m JOint ventures 14(b) - share of gross assets I 16,638 11,874 - share of gross babthltes ~10,879) (8,818)
5,759 3,056 Other mvestments 14 709 792 337,493 337,493
865,108 878,635 337,493 337,493 CURRENT ASSETS Short term mvesltnents 14(d) 3,734 5,249 Stocks 15 1,128 1,175 Debtors - due wtthm one year 16 153,819 138,364 234,828 201,030
- due after more than one year 16 2,608 3,523 120,000 120,000 Cash at bank and m hand 55,175 49,032
216,464 197,343 354,828 321,030 CREDITORS: amounts falhng due wtthm one year 17 (286,697) ~274,519) (232,965) {199,115)
NET CURRENT (LIABILITIES)/ ASSETS (70,233) (77, 176) 121,863 121,915
TOTAL ASSETS LESS CURRENT LIABILITIES 794,875 801,459 459,356 459,408
CREDITORS: amounts falhng due after more than one year 18 (I ,245,566) (1,227,220) (120,000) (120,000)
PROVISIONS FOR LIABILITIES 20 (14,745) (14,876)
NET (LIABILITIES)/ ASSETS EXCLUDING PENSION ASSET (465,436) (440,637) 339,356 339,408
PensiOn asset 23 16,081 5,799
NET (LIABILITIES)/ ASSETS INCLUDING PENSION ASSET ~449,355) (434,838) 339,356 339,408
CAPITAL AND RESERVES Called up share capttal 21 337,493 337,493 337,493 337,493 Merger rebefreserve 22 (506,095) (506,095) Profit and loss account 22 (281,239} (266,537} 1,863 I ,915
TOTAL SHAREHOLDER'S (DEFICIT)/FUNDS (449,841) (435, 139) 339,356 339,408
Mmonty mterests 32 486 301
CAPITAL EMPLOYED (449,355) (434,838) 339,356 339,408
The fmanctal statements of Peel Ports Shareholder FmanceCo Ltmtted (company regtstralton number 5965116), were approved by the Board ofDtrectors on 28 July 2011 and stgned on tls behalf by
M Whttworth Dtrector
11
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
CONSOLIDATED CASH FLOW STATEMENT For the vear ended 31 March 2011
2011 2010 Note £'000 £'000
Cash mflow from operatiOnal activities and non-operatmg exceptiOnal Item 24(a) 120,805 94,749
DIVIdends from JOint ventures 4,566 Returns on mvestments and serv1cmg of finance 24(b) (52,298) (50,611) Taxation pa1d (8,022) (3,737) Capital expenditure and financial mvestment 24(c) (29,244) (22,939) Acqms1t1on and d1sposals 24(d) 906 3,656 Eqmty dividends pa1d 11 (23,000) (24,000)
Cash inflow before financmg 9,147 1,684
Fmancmg 24(e) (3,008) (2,556)
Increase!( decrease) ID cash in the year 25 6,139 ~8722
RECONCILIATION OF GROUP CASH FLOWS TO MOVEMENT IN NET DEBT For the year ended 31 March 2011
2011 2010 Note £'000 £'000
Increase/( decrease) m cash m the year 25 6,139 (872) Cash outflow from mcrease m debt financmg 24(e) 914 24
Change in net debt resultmg from cash flows 7,053 (848) Change m net debt ar1smg from fmance leases 25 2,094 1,590 Termmatwn payment accrued on mdex-hnked swap 18 (18,260) (8,826) Change ID value of unamortised Issue costs 19(c) (3,050) (3,049) Exchange differences 25 8 (157)
Change in net debt ID the year (12,155) (11,290)
Net debt brought forward 25 (1,168,320) (1,157,030)
Net debt carried forward 19(b), 25 ~I, 180,4752 ~1,168,3202
12
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
l. ACCOUNTING POLICIES
These fmancoal statements are prepared under the h1stoncal cost conventiOn and m accordance w1th applicable Umted Kmgdom law and accountmg standards A summary of the more 1mportant Group accountmg pollc1es, wh1ch have been applied cons1stently throughout the current and pnor financial year, 1s set out below
Basis of preparatton
In cons1dermg the appropnateness of the gomg concern baSis of preparation, the d1rectors have conSidered forecasts for the next twelve months followmg the date of the Stgnmg of the 2011 fmanctal statements, wh1ch mclude deta1led cash flow forecasts and workmg cap1tal ava1lab1llty These forecasts show that sufficient resources remam available to the busmess for the next twelve months In add1t1on, the dtrectors note the followmg
• the d1rectors prepare and update detailed armual budgets, tbree year forecasts, and five year strategic plans Together these show that suffic1ent resources are ava1Iable to the busmess and on thts baSis the dtrectors contmue to adopt the gomg concern assumption,
• at the balance sheet date the Group has net hab1llt1es of £449,355,000 wh1ch are attnbuted to the reorgamsat1on of the Group m 2006 wh1ch was accounted for under merger accountmg pnnc1ples and resulted m the creation of a merger relief reserve of £506,095,000,
• at the balance sheet date, the Group has borrowmgs of£ 1,062,679,000 (2010 £1 ,063,572,000), wh1ch are subject to covenant restrictions The borrowmgs are m place until 31 December 2013 No breaches have occurred m the htstoncal penod The contmumg economtc cond1ttons create uncertamty However, even after takmg account of all reasonably posSible senStttv111es for changes m tradmg performance, the Group's forecasts and proJections md1cate that 11 ts expected to contmue to comply w1th covenant requirements for a penod of at least 12 months from the date of approval of the fmanctal statements,
• m the year ended 31 March 2011, wh1le ttmnover decreased by £3 6 m1lllon to £358 9 m1IIIon, Group operatmg profit mcreased by £1 1 7 m1lllon to £76 8 m1lllon, desp1te the contmumg uncertamty m the global economic environment Thts was due to a combmat1on ofh1gher volumes, enhanced productiVIty, Improved sales miX and the realised benefit of the Group's restructurmg exerctses,
• cash mflows generated m the year enabled the Group to finance fixed asset add1ttons of £29 9 m1lllon from cash, together w1th all financmg outflows, resultmg m an mcrease m net cash of £6 1 m1IIIon,
• there are undrawn loan fac1llt1es of £83 7 m1IIIon ava1lable to the Group, and
• the Group has net current llab1llt1es of £70 2 million pnnc1pally as a result of amounts owed to the 1mmedtate parent company, wh1ch the d1rectors believe w11l not be called for repayment w1thm twelve months of the Stgnmg of the fmanctal statements
After makmg enqumes, the directors have formed a judgment, at the t1me of approvmg the financial statements, that there IS a reasonable expectation that the Group and the Company have adequate resources to contmue m operattonal exiStence for the foreseeable future For thts reason, the d1rectors contmue to adopt the gomg concern basts of accountmg m prepanng the annual tinanc1al statements
Group financial statements
The financial statements for the year ended 31 March 2007 were prepared under merger accountmg pnnc1ples applicable for group reconstructions set out m FRS6 followmg the merger of the Company and Peel Holdmgs (Ports) L1m1ted Under merger accountmg, the results and cash flows of the Company and Peel Holdmgs (Ports) L1m1ted were combmed from the begmnmg of the financial penod m wh1ch the merger occurred All other subStd1ar1es were consolidated under acquts11ton accountmg pnnc1ples
The Group tinanc1al statements consolidate the tinanctal statements of the Company and 1ts subSidiary undertakmgs made up to 31 March each year
All subStdlanes m the year ended 31 March 2011 are consolidated under acquts1t1on accountmg prmc1ples Results of subSidiary undertakmgs acqutred or dtsposed of durmg the year are mcluded from the date of acqutsttlon or to the date of dtsposal to the extent of Group control
13
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
l. ACCOUNTING POLICIES (CONTINUED)
The financial statements of Peel HoldiDgs (Ports) Ltmtted ID 2005 were prepared under merger accountiDg pnnctples applicable for group reconstructions set out ID FRS6 followiDg the merger of Peel HoldiDgs (Ports) Ltmtted and Peel Ports HoldiDgs Lumted Under merger accountiDg, the results and cash flows of Peel HoldiDgs (Ports) Ltmtted and Peel Ports HoldiDgs Ltmtted were combiDed from the begiDniDg of the financtal penod ID whtch the merger occurred All other substdtartes were consolidated under acqutsttton accountiDg pnnctples
The Group profit and loss account IDCorporates the Group's share of the results of JOIDI ventures In the Group balance sheet, the fixed asset m vestment ID JOIDI ventures represents the Group's share of net assets of those undertakiDgs
The separable net assets of substdtary undertakmgs acqmred and accounted for under acqmstllon accountmg and JOmt ventures are mcluded m the Group financtal statements at their fair value to the Group at the date of acqutsttion mcludmg proviSions and habiltltes taken IDIO constderatton ID assessiDg the fatr value of the busiDess acqmred
Intra-group turnover and profrts are ehmiDated on consohdatton
As permitted by Secllon 400 of the Companies Act 2006, a separate profit and loss account for Peel Ports Shareholder FIDanceCo Ltmtled IS not presented The profit for the financial year of the Company was £22,948,000 (2010 £23,954,000)
Goodwill
Goodwill ansiDg on the acqutstllon of substdtary undertakiDgs, representiDg any excess of the fair value of the constderatwn gtven over the fair value of the tdenllfiable assets and habiltlles acqmred, IS capttahsed as an mtangtble asset and wntten off to the profit and loss account on a straight hoe basts over tls useful economtc hfe, up to a maxtmum of twenty years Provtston ts made for any lfDpatrrnent
When the Group has acqmred shares m other compames by the tssue of shares, and the reqUirements of merger accountmg have been sallsfied, the Group has ullhsed the merger rehef proviSIOns available and the ISsue of shares has been recorded at the nommal value, any premmm bemg credtted to the merger reserve
Tangible fixed assets
Tangtble fixed assets are stated at cost, net of deprectatton and any proviSion for tmpatrrnent DepreciatiOn IS provtded on all tangtble fixed assets, excludmg freehold and long leasehold land and capital work ID progress, at rates calculated to wnte off the cost, less esllmated reSidual value, of each asset on a straight hoe basiS over tls expected useful hfe as follows:
• operational bmldiDgs at rates varyiDg between 1% and 4% per annum,
• plant and machmery at rates varyiDg between I% and 25% per annum,
• freehold and long leasehold land IS not depreciated, and
• no deprectallon IS charged on capital work m progress until the assets are available for use On completiOn, such assets are transferred to the appropnate category of tangtble fixed assets
ReSidual value IS calculated usiDg pnces prevatlmg at the date of acquiSition
F1xed asset mvestments
Ftxed asset IDvestments ID subSidiary undertakiDgs are stated at cost less proviSion for tmpatrrnent Cost represents the aggregate cash conSideration, costs IDcurred and etther the fatr value or the nomiDal value of shares ISsued
Investments ID JOIDt ventures are accounted for usiDg the gross eqUity method
LISted IDvestrnents and other IDvestments are stated at cost to the Group less proviSIOn for lfDpatrrnent
Income from fixed asset ID vestments IS recogmsed m operatmg profit when diVIdends have been declared
14
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
I. ACCOUNTING POLICIES (CONTINUED)
Stocks
Stocks are stated at the lower of cost, and esllmated net realisable value Provision IS made where necessary for obsolete, slow movmg and defecllve stocks
Government grants
Government grants received m respect of capital expenditure are credited to a deferred mcome account and released to the profit and loss account over the useful economic hfe of the assets to which they relate
Leased assets
Assets acquired under finance leases are capitalised at a value equivalent to the cost mcurred by the lessor and depreciated over their expected useful economic hves Fmance charges !hereon are charged to the profit and loss account m the penod m which they accrue The capital element of the future lease payments IS reflected w1thm creditors
Costs m respect of operatmg leases are charged directly to the profit and loss account on a straight-line basis over the lease term
Finance costs
Interest-bearmg bank loans and overdrafts are recorded at the proceeds received, net of direct ISsue costs Issue costs associated With borrowmgs are charged to the profit and loss account over the term of the borrowmgs and represent a constant proportiOn of the balance of capital repayments outstaodmg Fmance charges, mcludmg premmms payable on settlement or redemptiOn and direct Issue costs, are accounted for on an accruals basis m the profit or loss account usmg the effective mterest method and are added to the carrymg amount of the mstrument to the extent that they are not settled m the penod m which they arise Accrued finance costs attributable to borrowmgs where the matunty at the date of Issue IS less than 12 months are m eluded m accrued charges with m current liabiiilles For all other borrowmgs, accrued fmance charges and Issue costs are added to the carrymg value of those borrowmgs
Foreign currencies
Assets and liab11illes denommated m foreign currencies, mcludmg overseas mvestments, are translated mto sterlmg at rates applicable at the balance sheet date or forward foreign exchange contract rates as appropnate The results of overseas operatiOns are converted at average rates applicable dunng the year Gams and losses ariSing m the ordmary course ofbusmess are mcluded m operatmg profit, and those on the translatiOn of assets, habllthes and reserves of overseas compames are shown as a movement on reserves
Derivatives
The Group uses swaps to adJUSt mterest rate exposures The Group does not hold or Issue denvat1ve financial mstruments for speculative purposes The Group considers Its denvallve mstruments quality for hedge accountmg when certam cntena are met
• the mstrument must be related to an asset or liability, and
• 11 must change the character of the mterest rate by convertmg a vanable rnte to a fixed rate or VICe versa
Interest differenllals are recogmsed by accrumg With net mterest payable Swaps are not revalued to fair value or recogmsed on the balance sheet at the year end If they are tennmated early, the gain/loss IS spread over the remammg matunty of the ongmal mstrument
TaxatiOn
Current tax IS provided at amounts expected to be paid (or recovered) usmg the tax rates and laws that have been enacted or substanllvely enacted by the balance sheet date
IS
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
I. ACCOUNTING POLICIES (CONTINUED)
Taxation (continued)
Deferred tax IS recogmsed m respect of all tlmmg differences that have ongmated but not reversed at the balance sheet date where transactiOns or events have occurred at that date that will result m an obhgatwn to pay more, or a nght to pay less or to receiVe more, tax, with the followmg exceptions
• provision IS made for deferred tax that would anse on remittance of the retamed earnmgs of overseas subsidiaries, assocl3tes and JOmt ventures only to the extent that, at the balance sheet date, dividends have been accrued as receivable, and
• deferred tax assets are recogmsed only to the extent that the directors consider that It IS more hkely than not that there w1ll be suitable taxable profits from which the future reversal of the underlymg tlmmg differences can be deducted
Deferred tax IS measured on an und1scounted baSIS at the tax rates that are expected to apply m the penods m wh1ch t1mmg differences reverse, based on tax rates and laws enacted or substantiVely enacted at the balance sheet date
Turnover
Turnover IS the revenue ansmg from the sales of goods and services It IS stated at the fair value of the consideratiOn receivable, net of value added tax, rebates and discounts Turnover from the sale of goods and services 1s recognised when the s1gmficant nsks and benefits of ownership of the product have transferred to the buyer or the service has been discharged, which may be upon shipment, completiOn of the product or the product bemg ready for delivery, based on specific contract terms
PensiOn costs
The cost of the Group's money purchase pension arrangements are charged to the profit and loss account on the basis of contributions payable m respect of the accountmg penod The Group also operates defined benefit schemes which require contributiOns to be made to separately admm1stered funds These have been accounted for under the requrrernents of FRS 17 "Retirement Benefits" ("FRS 17")
Under FRS 17, the defined benefit scheme assets are measured usmg market values Pension scheme habdllles are measured usmg the proJected umt method and are discounted at the current rate of return on a high quahty corporate bond of eqUivalent term and currency to the hab1hty Any m crease m the present value of the Group's defined benefit pensiOn scheme habdities expected to arise from employee service m the penod IS charged against operatmg profit The expected return on the schemes' assets and the m creases dunng the penod m the present value of the schemes' habihties ariSing from the passage oft1me are mcluded m other finance mcome Actuanal gams and losses are recogmsed m the statement of total recogmsed gams and losses
The Group recogmses an asset m respect of any surplus, bemg the excess of the value of the assets m the schemes over the present value of the schemes' hab1ht1es, only to the extent that It IS able to recover the surplus, either through reduced contributiOns m the future or from refunds from the schemes
16
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
2. SEGMENTAL ANALYSIS
Turnover Port and cana1mcome Shippmg mcome Transport mcome Gross rental mcome Other tradmg mcome
Direct costs
Gross profit AdmmistratiVe expenses PensiOn funds service costs (note 23) Amortisation of goodwill (note 12) ExceptiOnal Items (note 6) Other admmistratiVe expenses
Group operating profit before other operating income Other mcome Group operatmg profit Share of operatmg profit of JO!Dt venture compames
Total operating profit (mcludmg Group's share of joint ventures' operating profit)
2011 2010 £'000 £'000
236,951 230,210 65,622 61,116 22,640 38,823 28,759 28,497
4 927 3 823 358,899 362,469
(239,845) (248,403)
119,054 114,066
(3,104) (2,460) (10,105) (10,105)
(1,369) (8,526) (27,925) (28, 142) (42,503) (49,233)
76,551 64,833 282 296
76,833 65,129 3 468 4,624
80,301 69,753
Turnover does not mc1ude the Group's share of turnover ansmg from JOint ventures amountmg to £37,191,000 (20 10 £43, 760,000)
17
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
2. SEGMENTAL ANALYSIS
2011 2011 2011 2010 2010 2010 Rest of Rest of
UK Europe Total UK Europe Total £'000 £'000 £'000 £'000 £'000 £'000
Turnover by destmatton 290,204 68,695 358,899 290,292 72,177 362,469
Operatmg profit excludmg excepllonal Items 76,889 1,313 78,202 72,646 1,009 73,655
Excepttonal1tems (1,325) (44) (I ,369) (4,461) (4,065) (8,526)
Operatmg profit/(loss) 75,564 1,269 76,833 68,185 (3,056) 65,129
Share of JOmt venture operatmg profit 3,468 3,468 4,624 4,624
Net mterest payable and s•m•lar charges {69,485) {196) {69,681) {59,555) {258) {59,813)
Group operatmg profit/(loss) less net mterest payable 9,547 1,073 10,620 13,254 p,314~ 9,940
Profit/(loss) on disposal of mterests m -- Subs1d1ary undertakmgs 776 (448) - Jomt ventures 1,917 - Fixed asset mvestments (82)
Non-operatmg exceptiOnal Item 164
Profit on ordmary achvtttes before taxatiOn 11,314 11,573
Net (habdilles)/assets (472,693) 23,338 (449,355) (450,813) 15,975 (434,838)
Turnover for the year ended 31 March 2010 mcludes £5,635,000 ariSing from the substantml completiOn of serv1ces prov1ded under the terms of ex1stmg contractual arrangements The directors cons1der that no further obhgat10ns ex1st g1ven that all serv1ces have now been rendered and the hkehhood of the remstatement of acttvtttes m the future IS remote
The table below shows the 1mpact on recorded turnover
2011 2010 £'000 £'000
Turnover as recorded 358,899 362,469 Non-recurrmg turnover (5,635)
358,899 356,834
18
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
3. GROUP OPERATING PROFIT
Group operatmg profit IS stated after chargmgl( cred1tmg) Depreciation - owned assets
- leased assets Amortisation of goodwill Profit on disposal of fixed assets Hue of plant and machmery under operatmg leases Hue of other assets under operatmg leases Grant releases F ore1gn currency exchange losses
Fees payable to the Company's auditor for the audit of the Company's annual financial statements
Fees payable to the Group's auditor for the audit of the Group's annual financial statements
Fees payable to the Group's auditor for non-audit services-• taxation serv1ces - corporate finance servtces Total non-audit fees
2011 2010 £'000 £'000
34,189 30,988 936 828
10,105 10,105 (I ,330) {1,168) 20,308 19,829
4,847 3,980 (782) (793) 238 900
10 10
328 375
161 203 7 255
168 458
19
------- ---------------------
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
4. EMPLOYEE INFORMATION
The average monthly number of persons employed by the Group durmg the year, mclusive of executive directors, was as follows
Admmistratwn Port operatiOnal and mamtenance staff
The staff costs for the above persons were
Wages and salaries Social secunty costs PensiOn funds service costs (note 23) Other pensiOn costs - Group pensiOn schemes - Multi-employer schemes
2011 Number
252 925
1,177
2011 £'000
42,710 4,065 3,104
1,207 6
51,092
2010 Number
275 1,063
1,338
2010 £'000
47,029 4,359 2,460
727 135
54,710
Durmg the year ended 31 March 2011, the Group mtroduced a 'Smartpay' pensiOn arrangement whereby participatmg employees forego part of theu salary m return for higher employer pension contributions The Impact of this has been to mcrease the employer contributiOns (other pensiOn costs) dunng the year with a correspondmg decrease m wages and salaries expense
The Company had no employees dunng the year or durmg the previous year
5. DIRECTORS' REMUNERATION
The remuneratiOn of the directors of the Group was as follows
Emoluments CompensatiOn for loss of office Group contributiOn to defmed contnbutwn pensiOn schemes
2011 £'000
889 408
82
2010 £'000
1,085
126
1,379 1,211
At 31 March 2011 retirement benefits are accrumg to one duector (2010 one) under a Group defined benefit pension scheme and to two duectors under a defined contributiOn scheme (2010 two)
The above analysis excludes the emoluments of directors who are remunerated by undertakmgs outside of the Peel Ports Shareholder FmanceCo group of companies and have to account m turn to those undertakmgs
The remuneratiOn of the highest paid director was as follows
Emoluments Group contnbutwn to defmed contnbution pensiOn schemes
2011 £'000
400 25
2010 £'000
727 100
20
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
6. EXCEPTIONAL OPERATING COSTS
Restructunng costs (note 2)
2011 £'000
1,369
2010 £'000
8,526
Restructurmg expenses compnse redundancy and other costs mcurred m connection with the streamlmmg and reorgamsation of activities as part of a strategic review of the Group's operations
7. PROFIT ON DISPOSAL OF INTERESTS IN SUBSIDIARY UNDERTAKINGS, JOINT VENTURES AND FIXED ASSET INVESTMENTS
The profit for the year ended 31 March 2011 relates to the disposal of a 35% mterest m Portm Management Services Limited, a subsidiary of the Group, on I June 20 I 0, which gave nse to a profit on disposal of £776,000 as set out below In additiOn, a loss on disposal of an unlisted fixed asset m vestment of £82,000 has also been recorded m the year ended 31 March 2011 The profit on disposal of mterests m JOint ventures for the year ended 31 March 2010 relates pnncipally to the sale of the Group's mvestrnent m the JOint venture VIzag Seaport Private Lumted
Profits on the disposal of mterests m subsidiary and JOint venture undertakmgs are set out m more detail below
DISposal of interest m subSidiary undertaking
Proceeds - cash
Share of net assets disposed
Profit on disposal
DISposal of joint venture undertaking
Proceeds - cash
Share of net assets disposed
Profit on disposal
There was no taxatiOn or mmonty mterest charge or credit applicable to the profits shown above
8. NON-OPERATING EXCEPTIONAL ITEM
2011 £'000
906
(130)
776
2010 £'000
3,633
(1,716)
1,917
In the year ended 31 March 20 I 0 the Group recognised non-operatmg exceptional mcome of£ 164,000 This related to the recovery, from a third party, of exceptiOnal costs mcurred and recorded m the profit and loss account for the year ended 31 March 2009 Further details of thiS transactiOn were disclosed m the pnor year financial statements
21
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
9. NET INTEREST AND SIMILAR ITEMS
Interest payable: Change m tennmat10n payment accrued on mdex-lmked swap Other mterest on bank loans and overdrafts
Bank loans and overdrafts AmorttsatJOn of Issue costs 9% subordmated redeemable loan notes
Payable to group undertakmgs Payable to related undertakmgs
Other loans Fmance leases Group mterest payable and s1m1lar charges Share of JOmt venture mterest payable
Total interest payable
Interest rece1vable: Group mterest receiVable and Slrnllar mcome Share of JOmt venture mterest receiVable Total interest receiVable
Other finance income (note 23) Expected return on pens1on scheme assets Interest on pens10n scheme hab1ht1es Total other finance income
Net mterest and similar 1tems
2011 £'000
(18,260) (41,712)
(59,972) (3,050)
(5,411) (5,389)
(289) (221)
(74,332)
(74,332)
411 14
425
23,354 (19,128)
4,226
(69,681)
2010 £'000
(8,825) (38,102)
(46,927) (3,049)
(5,411) (5,389)
(997) (314)
(62,087)
(62,087)
618 15
633
19,690 (18,049)
1,641
(59,813)
22
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
10. TAX ON PROFIT ON ORDINARY ACTIVITIES
Current tax: United Kingdom UK corporation tax Foreign tax Corporatton tax Otller current lax Adjustments m respect ofprevtous penods (Umted Kmgdom) Group current tax charge Share of JOmt venture current tax
Total current tax charge
Deferred tax: Ongmat1on and reversal of tunmg differences • Umted Kmgdom · fore1gn tax Adjustments m respect of pnor penods Change of UK tax rate Penston cost rehef m excess of pension cost charge Pens1on cost rehef- change of UK tax rate Group deferred tax charge Share of JOmt venture deferred tax
Total deferred tax charge
Total tax on loss on ordinary activities
2011 £'000
6,953
74
(1,756) 5,271
908
6,179
(66) (62)
1,016 (1,014) 1,838 (174)
1,538 17
1,555
7,734
2010 £'000
7,504
90
38 7,632 1,279
8,911
1,664 (494) (476)
694 6
700
9,611
Excludmg deferred tax 1tems relatmg to the defined benefit penston schemes and to JOmt ventures, the deferred tax credit IS £126,000 (2010 charge of£694,000) (note 20)
The UK government announced m June 20 I 0 that 1t mtended to reduce the rate of corporation tax from 28% to 24% over four years The Fmance Act 2010, wh1ch was substant1vely enacted m July 2010, mcluded prov1stons to reduce the rate of corporation tax to 27% w1th effect from I Apnl 2011 On 23 March 2011 the UK government announced that 1! mtended to reduce the rate of corporation tax further to 26% w1th effect from I Apnl2011 and then by 1% per annum to 23% by I Apn12014 The reduction to 26% was substant1vely enacted before the balance sheet date The further mtended reductiOns have not been substantlvely enacted The deferred tax balances as at 31 March 2011 have therefore been calculated at a rate of 26%, wh1ch has resulted m a cred1t to the profrt and loss account of£1,188,000 (mcludmg the 1mpact on pens1on cost rehef)
23
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
10. TAX ON PROFIT ON ORDINARY ACTIVITIES (CONTINUED)
Reconciliation of current tax charge The tax assessed for the year 1s h1gher (20 I 0 h1gher) than that ansmg from applymg the standard rate of UK corporatiOn tax of28% (2010 28%) The d1fferences are explamed below
Profit on ordmary actiVIties before taxatiOn
Profit on ordmary act1v1hes mulhphed by the standard rate of UK corporation tax of28% (2010 28%)
Effects of Short term hmmg differences and depreciatiOn m excess of/(less than)
cap1tal allowances Expenses not deductible for tax purposes Excess of book profits over taxable profits on sale of fixed assets Group rehef surrendered w1thout payment Adjushnents m respect of pnor penods Adjushnents m respect of fore1gn tax rates Pens10n rehef m excess of penswn charge
Current tax charge
11. EQUITY DIVIDENDS PAID
lntenm ordmary d1v1dends of £0 068 (20 I 0 £0 071) per share
12. INTANGIBLE FIXED ASSETS
Group
Cost At I Apnl 2010 and at 31 March 2011
Amortisation At I Apnl2010 Charge for the year
At31 March 2011
Net book amount At 31 March 2011
At31 March2010
2011 2010 £'000 £'000
11,314 11,573
3,168 3,240
197 (310)
7,141 6,557 (220) (411)
14 (1,756) 38
(372) (217) (1,979)
6 179 8 911
2011 2010 £'000 £'000
23,000 24,000
Positive goodwill
£'000
202,108
45,863 I 0,105
55,968
146,140
156,245
24
•
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 20ll
13. TANGIBLE FIXED ASSETS
Land and buildings-
freehold Plant and Plant and Capital and long machinery machmery work m leasehold -owned • leased progress Total
Group £'000 £'000 £'000 £'000 £'000
Cost
At I Apnl2010 (as restated) 661,272 178,873 17,658 6,958 864,761 AdditiOns 1,761 9,728 18,450 29,939 D1sposals (18) (2,754) (608) (3,380) Tnmsfer from capital work m progress 1,345 6,859 (8,204) Exchange difference {44) {206) {5) {255)
At 31 March 2011 664,316 192,500 17,653 16,596 891,065
Depreciation
At I Apnl2010 (as restated) 78,438 65,556 2,225 146,219 Charge for the year 17,747 16,442 936 35,125 D1sposals (2,713) (2,713) Exchange difference {9) {55) {2) {66)
At 31 March 2011 96 176 79230 3 159 178 565
Net book amount At 31 March 2011 568,140 113,270 14,494 16,596 712 500
At 31 March 2010 (as restated) 582,834 113,317 15,433 6,958 718,542
As a result of a review of the tangible fixed assets held by the Group, a number of adjustments have been made to the fixed assets ledger These adjustments relate to assets which contmue to be used m the bus mess and which compnse part of the Group's mventory of tangible fixed assets Therefore, these have been mcluded above as an adjustment to the openmg cost and accumulated depreCiatiOn As a result of these adjustments, which have a £ml net book value Impact on total fixed assets, cost as at I Apnl2010 has been mcreased by £9,364,000 from £855,397,000 and accumulated depreciBtiOn has been m creased by £9,364,000 from£ 136,855,000
Non depreciable land
Included w1thm tangible fixed assets IS freehold and long leasehold land, which IS not subject to depreciBtiOn, m the amount of £140,311,000 (2010 £129,561 ,000)
The Company has no tangible fixed assets
25
'
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
14. INVESTMENTS
(a)
Group Company 2011 2010 2011 2010
£'000 £'000 £'000 £'000
Subsidiary undertakmgs (note 14(a)) 337,493 337,493 Jomt venture undertakmgs (note 14(b)) 5,759 3,056 Listed mvestments (note 14(c)) 624 624 Unlisted mvestments 85 168
6,468 3,848 337,493 337,493 Other m vestments of £709,000 (2010. £792,000), disclosed on the face ofthe balance sheet, relate to the listed and unlisted mvestments mcluded m the table above
Subsidiary undertakmgs
Cost At I Apnl2010andat31 March2011
Company £'000
337,493
At 31 March 2011, the Company holds an mvestment m the entue share capital of Peel Ports Intermediate Holdco Limited The Issued share capital of that company IS 337,492,988 ordmary shares of £1 each
Details of m vestments of the Company m its prmc1pal subsidiary undertakmgs and Jomt ventures are g•ven m note 34
(b) Joint ventures
At I Apnl2010
Group £'000 3,056 2,557 Share of results for the year
Share of actuarial gam net of deferred taxatiOn relatm£ to defined benefit pensiOn scheme
At 31 March 2011
146
5,759
The followmg mformahon IS g•ven m respect of the Group's share of the prmcipalJomt venture Cammell Laud Sh1prepa1rers & Sh1pbmlders Limited (note 34)
Group 2011 2010
£'000 £'000
Turnover 35,101 42,101
Profit before tax 3,103 4,503
Taxation (869) {1,258}
Profit after tax 2,234 3,245
Fixed assets 1,914 994
Current assets 9,677 6,190
Liabilities due w1thm one year {7,032) {4,859}
Net assets 4,559 2,325
The turnover and net assets of the other JOmt ventures amounted to £2,090,000 (2010 £1,659,000) and £I, 188,000 (20 I 0 £731 ,000) respectively
26
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
14. INVESTMENTS (CONTINUED)
(c) Listed investments
At I Apnl2010 and at 31 March 2011
Group £'000
624
The aggregate market value of the Group's listed mvestments based on the closmg middle market pnce on the London Stock Exchange on 31 March 2011 was £596,000 (20 10 £586,000) The mark-to-market loss at 31 March 2011 on listed mvestments has not been recogmsed by the Group as It •s not considered to reflect a permanent d1mmution m value
(d) Short term investments
Short term m vestments compnse £3,734,000 (201 0 £5,249,000) of cash held on short term deposit which acts as collateral for certam floatmg rate guaranteed loan notes (note 19(b)) This cash IS only available for redemption of those floatmg rate guaranteed loan notes
IS. STOCKS
Group 2011 2010
£'000 £'000
Raw matenals and consumables 1,128 1,175
There IS no matenal difference between the balance sheet value of stocks and their replacement cost
The Company has no stocks
16. DEBTORS
Group Company 2011 2010 2011 2010
£'000 £'000 £'000 £'000 Amounts falling due w•thm one year: Trade debtors 48,394 53,224 Amounts owed by group undertakmgs 93,444 70,798 234,828 201,028 Amounts owed by related companies 97 236 Other debtors 3,645 2,410 2 Prepayments and accrued mcome 6,412 10,702 CorporatiOn tax recoverable 1,827 994
153,819 138,364 234,828 201,030 Amounts falling due after more than one year: Amounts owed by Group undertakmgs 120,000 120,000 Prepayments and accrued mcome 2,608 3,523
156,427 141,887 354,828 321,030
Amounts owed by Group undertakmgs falling due after more than one year relate to a loan made to a subsidiary undertakmg The loan bears mterest at 9% per annum and IS repayable m full on 30 September 2046
27
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
17. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group Company 2011 2010 2011 2010
£'000 £'000 £'000 £'000
Bank loans and overdrafts 4 Floatmg rate guaranteed loan note mstruments 3,734 5,249 Fmance leases 1,260 2,031
Debt falhng due wtthm one year (note 19) 4,994 7,284 Trade credttors 25,951 27,059 Amounts owed to Group undertakmgs 187,338 163,741 227,542 193,700 Amounts owed to related compames 391 296 Corporahon tax 7,008 8,889 Taxahon and soctal secunty 2,419 3,677 Other credttors 8,876 13,744 Accruals and deferred mcome 48,983 49,038 5,423 5,415 Government grants 737 791
286,697 274,519 232,965 199,115
18. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group Company 2011 2010 2011 2010
£'000 £'000 £'000 £'000
Bank loans 1,060,260 I ,058,103 Termmatton payment accrued on mdex-hnked swap 49,026 30,766 9% subordmated redeemable loan notes due to group
undertakmgs 60,120 60,120 60,120 60,120 9% subordmated redeemable loan notes due to related
undertakmgs 59,880 59,880 59,880 59,880 Other loans 4,116 4,137 Fmance leases 988 2,311
Debt falhng due after more than one year (note 19) 1,234,390 1,215,317 120,000 120,000 Government grants 9,146 9,874 Other credttors 2,030 2,029
1,245,566 1,227,220 120,000 120,000
28
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
19. LOANS AND OTHER BORROWINGS
(a) Financtalliabihties Bank overdrafts Bank loans Termmatton payment accrued on mdex-lmked swap 9% subordmated redeemable loan notes 2046
Due to group undertakmgs Due to related undertakmgs
Floatmg rate guaranteed loan note mstruments 2008 Floatmg rate guaranteed loan note mstruments 20 15 3% trredeemable loan stock 3 625% trredeemable debenlltre stock Perpetual debenture stocks Fmance lease obhgattons
(b) Analysis of Group net debt Fmanctal habthttes falhng due wtthm one year Fmanctal habthttes falhng due after more than one year
Total financial habilities Cash at bank and m hand Short term depostts held as guarantee agamst floatmg rate guaranteed loan note mstruments (note 14(d))
Group net debt
(c) Maturity of financial habilities
Net obligations under finance leases are payable as follows: In one year or less In more than one year, but not more than two years In more than two years, but not more than five years
Maturity of other financial habthltes: In one year or less or on demand In more than two years, but not more than five years In more than five years not by mstalments
Financialliabdihes, net of unamortised issue costs and finance charges allocated to future penod
UnamortiSed Issue costs
Group lOll 2010
£'000 £'000
4 1,060,260 1,058,103
49,026 30,766
60,120 60,120 59,880 59,880
13 13 3,721 5,236 1,155 1,176
728 728 2,233 2,233 2,248 4,342
1,239,384 1,222,601
4,994 7,284 1,234,390 1,215,317
1,239,384 1,222,601 (55,175) (49,032)
(3,734) (5,249)
I, 180,475 I, 168,320
1,260 2,031 692 1,038 296 1,273
2,248 4,342
3,734 5,253 1,109,286 1,058,103
124,116 154,903
1,237,136 1,218,259
1,239,384 1,222,601
2,419 5,469
Fmanctal habthttes mclude bank loans of£ I ,062,679,000 (20 I 0 £1 ,063,572,000) and overdrafts of £ml (20 I 0 £4,000) which are secured by a fixed legal charge on certam freehold properttes and mvestments and by a floatmg charge over all other assets of certam Group compames both present and future A cross corporate guarantee extsts between certam Group compantes m respect of secured borrowmgs Bank loans dtsclosed wtthm "Credttors amounts fallmg due after more than one year" are due for repayment on 31 December 2013
29
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
19. LOANS AND OTHER BORROWINGS (CONTINUED)
The bank loans bear mterest at LIBOR plus applicable margm At 31 March 2011, mterest on £594,000,000 (20 10 £594,000,000) of these loans was fixed by an mterest rate swap at 4 469% plus margm, and mterest on £18,000,000 (2010 £18,000,000) of these loans was fixed by an mterest rate swap at 3 93% plus margm The fatr value calculated m respect of the swap of£594,000,000 at 31 March 2011 was a habthty of£46,845,000 (2010 £47,746,000) and the farr value calculated m respect of the swap of £18,000,000 was a gam of £193,000 (2010 £79,000) The movement m the fatr value of the mterest rate swaps reflects the revised expectaiions of long term mterest rates followmg the global economic downturn
At 31 March 2011, mterest on £343,000,000 (2010 £343,000,000) of bank loans was offset by an mdex-hnked swap under whtch the Group receives a floatmg rate of mterest of LIBOR plus margm and pays an tmtial rate of mterest of 2 3115%, whtch mcreases over the term of the swap by the movement m the UK Retail Prtces Index ("UKRPI") In addtiiOn a sum ts payable on termmallon, whtch ts also determmed by the movement m the UKRPI over the term of the swap At 31 March 2011 mterest on £9,000,000 (20 I 0 £9,000,000) was offset by a further mdex-hnked swap under whtch the Group receives a floatmg rate of mterest of LIBOR plus margm and pays an mtllal rate of mterest of I 65%, whtch mcreases over the term of the swap by the movement m the UKRPI, also wtth a sum payable on termmat10n, determmed by the movement m the UKRPI over the term of the swap
The fair value habthty of the mdex-lmked swaps mcreases over time to reflect the nature ofthe cash flows over the hfe of the swap, under whtch the Group receives a significant benefit m the early years whtch reduces as the UKRPI moves over lime In addtiion the fatr value of the mdex-lmked swaps reflects movements m expectations of long term mterest and mflat10n rates To the extent that the movement m the RPI m the penod to 31 March 2011 has resulted m an amount payable on termmat10n of the swap, then proviSion has been made m the financial statements At 31 March 2011, thts amounted to £49,026,000 (2010) £30,766,000) At 31 March 2011, the fair value calculated m respect of the swap of £343,000,000 was a habthty of£ 163,596,000 (2010 £150,747,000) The fatr value of the swap of £9,000,000 was a habthty of £1,640,000 (2010 £1,414,000) The amounts mclude the termmaiion accrual of £49,026,000 (2010 £30,766,000) detailed above The movement m the fatr value of the mdex-hnked swaps also reflects the revtsed expectations of long term mterest rates followmg the global economic downturn
The mterest rate and RPI swaps are thirty year mstruments whtch contam mandatory early termmat10n dates of 31 December 2013 The Group negoiiated thirty year mstruments as the dtrectors aniictpated usmg LIBOR based debt structures for at least that penod of lime and they wtshed to protect the Group's exposure to movements m mterest rates for the full thirty years The dtrectors negotiated the mandatory early termmatton dates so the Group would not be bound to the current hedgmg counterparttes beyond 31 December 2013 The directors aniictpate replacmg the extstmg bank loans With similar fundmg on or before 31 December 2013 and novatmg the mterest rate and RPI swap mstruments as part of the financmg exercise The directors aniictpate rolling up any positive or negative fau value m existence at the refundmg date as part of the novation process Thts fatr value adJUS!Inent would be amortised over the remammg hves of the swap mstruments Consistent With accountmg reqUirements no fatr value of the denvattves IS recogmsed
At 31 March 2011 the Group had also entered m to basiS swap arrangements wtth a notiOnal value of £964,000,000 (20 I 0 £964,000,000) under whtch 11 exchanges I month and 3 month LIBOR mterest rates The fau value calculated m respect of these basis swaps was a habthty of £850,000 (20 I 0 £606,000). In addition, the Group entered mto a basts swap wtth a noiional value of£ 156,000,000 pnor to 31 March 2011, whtch had a commencement date after 31 March 2011 The fatr value calculated m respect of this basts swap at 31 March 2011 wasagamof£10,000
The 9% subordmated redeemable loan notes were Issued to Peel Ports Holdmgs (IOM) Limited and to Infrastructure JVCo (Ltme) SA R L at par m the year ended 31 March 2007 Dunng the year ended 31 March 20 I 0 new loan notes were Issued to the extstmg loan note holders m the same prmctpal amount as those Issued m 2007 The consideratiOn for the new loan notes was the surrender of the ongmal loan notes The new loan notes have tdenttcal terms mcludmg a final repayment date of 30 September 2046 Interest IS payable biannually m arrears
30
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
19. LOANS AND OTHER BORROWINGS (CONTINUED)
The floatmg rate guaranteed loan note mstruments 2008 and 20 15 are guaranteed by The Royal Bank of Scotland plc and Bank of Scotland plc respectively The floatmg rate guaranteed loan note mstruments 2015 bear mterest based on LIBOR and are redeemable at par on demand of the holder on any mterest payment date pnor to and mcludmg the fmal matunty date of 30 September 2015 The floatmg rate guaranteed loan note mstruments 2008 remam due but unpaid m relation to unclaimed loan notes
The perpetual debenture stocks are secured by floatmg charges over the undertakmg of The Manchester Sh1p Canal Company Limited and bear mterest at rates between 3 5% and 4%
The 3% Irredeemable loan stock Issued by Clydeport OperatiOns Limited has no fixed redemptiOn dates and can only be redeemed w1th the agreement of the respective stockholders. Stockholders have no nght to demand redemptiOn
The 3 625% Irredeemable debenture stock IS secured by a fixed charge over certam secunties and a tloatmg charge over Peel Ports (lDS) Limited
Fmance lease obligations are secured on the assets to which they relate (note 13)
20. PROVISIONS FOR LIABILITIES
Group
At I Apnl2010 Credit to profit and loss account (note 10) Exchange difference
At 31 March 2011
Provision for deferred tax comprtses:
Accelerated capital allowances Other timmg differences
The Company has no deferred tax hab1hties
21. CALLED-UP SHARE CAPITAL
Authorised
500,000,000 ordmary shares of£ I each Allotted, called up and fully paid
337,492,988 ordmary shares of£1 each
Group Group 2011 2010
£'000 £'000
500,000 500,000
337,493 337,493
Deferred TaxatiOn
£'000
14,876 (126)
{5)
14,745
2011 2010 £'000 £'000
16,943 17,451 {2,198) {2,575)
14,745 14,876
Company Company 2011 2010
£'000 £'000
500,000 500,000
337,493 337,493
31
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
22. RESERVES
Profit Merger and loss reserve account Total
Group £'000 £'000 £'000
At I Apnl2010 (506,095) (266,537) (722,632) Net exchange adjustruents (209) (209) Profit for the financtal year 3,459 3,459 Dtvtdends (note 11) (23,000) (23,000) Actuanal gam relatmg to the Group's penston scheme (note 23) 6,624 6,624 Movement on tax relatmg to penston asset (1,722) (1,722) Actuartal gam relatmg to JOIDt venture penston schemes 146 146
At 31 March 2011 ~506,095~ ~281,239~ ~787,334~
The merger reserve arose as a result of the reconstructiOn of the Group m 2005 when Peel Holdmgs (Ports) Ltmtted and Peel Ports Holdmgs Ltmtted merged and subsequently m the year ended 31 March 2007 when the Company merged wtth Peel Holdmgs (Ports) Ltmtted The merger accountmg pnnctples set m FRS6 "Acqmsttions and Mergers" were applied to these Group reconstructions.
Company
At I Apnl2010 Profit for the fmancml year DlVldends (note 11)
At 31 March 2011
23. PENSION FUNDS
Defined contnbution schemes
Profit and loss account
£'000
1,915 22,948
(23,000)
1,863
The Group operates a number of money purchase penswn schemes provtdtng benefits based on actual contnbuttons patd m the Umted Kmgdom and the Republic of Ireland The assets of the schemes are held separately from the assets of the Group and are admmtstered by trustees and managed professiOnally The contnbu!Ions of the Group varted between 2% and 25% (2010 varted between 2% and 25%) of pensionable salanes for the financtal year Group contnbu!Ions to money purchase penston schemes match those patd by employees up to a maxllDum of 6% In addttton, dunng the year ended 31 March 20 11, the Group mtroduced a 'Smartpay' penswn arrangement whereby parttctpatmg employees forego part of thetr salary m return for htgher employer pensiOn contrtbutwns Contnbu!Ions totalling £1,207,000 were patd durmg the year (2010 £727,000)
Grouo defined benefit schemes
The Group also operates a nUIDber of defmed benefit pensiOn schemes m the Umted Kmgdom and The Netherlands based on final penswnable pay The mam defined benefit pens1on scheme ts based m the Umted Kmgdom and represents 98% of the total liabilities m the Group's defined benefit pensiOn schemes The assets of the schemes are held separately from the assets of the Group and are admmiStered by trustees and managed professiOnally
Contnbutmns of the Group to the defined benefits penSion schemes are based on penswn costs across the Group as a whole The contribUtions are determmed by a qualified actuary on the basts of tnenmal valua!Ions usmg the proJected umt method The most recent full trtenmal actuarial valuatwns was as at Apnl2009
32
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Contnbut10ns totalling £5,915,000 were pa1d dunng the year (2010 £3,173,000) The contnbutlons of the Group to the defined benefit pensiOn schemes var1ed between 12 0% and 28 7% of pensiOnable salanes The contnbut10ns made by employees to the defined benefit penswn schemes vaned between 5% and 9% of penswnable salanes
The mam assumptions m the actuanal valuation as at Apnl 2009 were that long-tenn mvestment rates would be 7 0% per annum pre retirement and 4 75% per armum post retuement, pensiOnable salary mcreases would be 2 8% per annum, the maJority of penswns m payment would mcrease at a rate of between 2 8% and 3 3% per annum, and pnce mflat10n would be 2 8% per annum As at the latest actuarial valuatiOn, the value of the assets was enough to cover between 78% and 88% of the benefits that had accrued to members, after allowmg for expected future mcreases m eammgs
As at 31 March 2011, the assets of the defined benefit pens1on schemes were valued at £38 I mllhon (20 I 0 £365 m1lhon)
Dunng the year ended 31 March 2011, the Govenunent announced 1ts mtentlon to move to usmg the Consumer Pnce Index (CPI), rather than the Retail Pnce Index (RPI) as prevwusly, as the measure of pnce mflat1on for the purposes of regulatmg occupatiOnal pens1on schemes The revaluation order 1mplementmg th1s change was 1ssued m December 2010 The 1mpact of the changes announced by the Government on any part1cular scheme depends on the prov1s1ons of the rules of that scheme and, m particular, whether these state specifically that mcreases should be m hne w1th a spec1fied mdex or whether they cross refer to the statutory prov1s1ons requmng pens1ons to be mcreased Followmg a rev1ew of the rules of the Group's defined benefit pens1on schemes, and based on actuanal adv1ce, the 1mpact of the change has been evaluated and, where appropnate, reflected m the FRS I 7 numbers for the year ended 3 I March 2011 The overall1mpact has been to reduce the value of the scheme hab1ht1es at 31 March 2011 by £3,326,000, recogmsed as an actuarial gam m the statement of total recogmsed gams and losses, and to decrease the expected charge to the profit and loss account for the year endmg 31 March 20 12
Group contnbutwns for the defined benefit pensiOn schemes for the year endmg 31 March 2012 are expected to be m the reg10n of £5,800,000
The most recent actuarial valuat1ons were updated to 31 March 2011 by quahfied actuar1es These valuat10ns used a set of assumptiOns cons1stent w1th those reqmred under FRS 17 The maJor assumptions used by the actuar1es are set out below
MaJor actuanal assumptions
Rate of mcrease m pens1onable salar1es Rate of mcrease of pens1ons m payment Rate of mcrease for deferred pensiOners Discount rate Pnce mflatlon (RPI) Pnce mflat1on (CPI)
3I March 2011 %pa
3 40 3 40 3 40 5 50 3 40 240
31 March 2010
0/o pa
3 60 3 60 3 60 5 50 3 60
n/a
33
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Mortality Current peruaoners Actuarial tables used
Male life expectancy at age 65
Future pensioners Actuarial tables used
Male life expectancy at age 65 (currently aged 45)
110% SAPS tables, birth year, with medium cohort
Improvements and a 1% underpm•
20 6years
110% SAPS tables, birth year, with medmm cohort Improvements and a 1%
underpm
22 5 years
110% SAPS tables, birth year, With medmm cohort
Improvements and a I% underpm•
20 6 years
I I 0% SAPS tables, birth year, with medmm cohort Improvements and a I%
underpm
22 5 years
The assumptiOns used by the actuary are the best estimates chosen from a range of possible actuarial assumptions which, due to the llmescale covered, may not necessanly be borne out m practice
•An adJustment of 120% (mstead of 110%) was applied m settmg the mortality assumption adopted for the Clydeport section of the mam defmed benefit pensiOn scheme
The sensitivities regardmg the pnncipal assumptions used to measure the scheme liabilities are set out below
Assumption
Discount rate Inflation Rate of mcrease m pensiOnable salaries Mortality
Changes in the present value of the defined benefit liabilities are as follows:
Openmg defined benefit liability Recogmt10n of MNOPF liabilities Current servtce cost Interest cost Employee contnbutions Actuarial (gams)/losses on scheme habihties Benefits paid Past servtce cost Curtailments and settlements
Closmg defined benefit liability
Change in assumption
+/- 0 5% +/- 0 5% +/- 0 5%
+I year
Group 2011
£'000
356,681 4,780 3,104
19,128 910
(8,668) (19,150)
356,785
Impact on scheme
liabilities
-7%/+7% +5%/-5% +1%/-1%
+3%
Group 2010
£'000
275,681
2,860 18,049 1,076
80,127 (20,712)
37 (437)
356,681
34
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Analysis of the defined benefit obligation: Group Group 2011 2010
£'000 £'000
Present value of unfunded habthttes 1,115 1,628 Present value of funded habtltttes 355,670 355,053
356,785 356,681
Reconciliation of fatr value of scheme assets: Group Group 2011 2010
£'000 £'000
Openmg fatr value of scheme assets 364,916 294,790 Recogmtton of MNOPF assets 3,706 Expected return on scheme assets 23,354 19,690 Actuanal gaiDS on scheme assets 1,296 66,899 Foretgn currency exchange rate changes 7 Contnbuttons by the Group 5,915 3,173 Contnbuttons by employees 910 1,076 Benefits patd {19,150} {20,712)
ClosiDg fatr value of scheme assets 380,954 364,916
Amounts to be recognised ID the balance sheet: Group Group 2011 2010
£'000 £'000
Present value of funded habthttes (355,670) (355,053) Fatr value of scheme assets 380,954 364,916
25,284 9,863 Surplus restnctton (2,266) Present value of unfunded habthttes {1,115) {1,628) Recogntsable asset before deferred taxatton 21,903 8,235 Deferred taxatton {5,822) (2,436)
Amount recogntsed ID the balance sheet 16,081 5,799
35
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Amount to be recognised in the profit and loss account:
Current serviCe cost Interest cost Expected return on scheme assets Past serv1ce cost Gams on curta1hnent and settlements
Total expense
Group 2011
Group 2010
£'000 £'000
3,104 19,128
(23,354)
(1,122)
2,860 18,049
(19,690) 37
(437)
819
Of the credit for the year (20 I 0 charge), a charge of £3, I 04,000 (20 I 0 £2,460,000) has been mcluded m admmistrallve expenses and a credit of £4,226,000 (20 10 £I ,641 ,000) has been mcluded w1thm net mterest and sumlar Items
Cumulative amount of actuarial gains and losses recogmsed m the statement of total recognised Group Group gams and losses smce adoption of FRS 17: 2011 2010
£'000 £'000
Openmg cumulative {17,788) {4,560)
Actuarial gams/(losses) 8,890 (13,228) Effect of restnction Imposed {2,266) Movement m the year 6,624 {13,228)
Closmg cumulative (11,164) (17,788)
Plan assets Expected Expected Fair value rate of Fa1rvalue rate of
of assets return ofassets return 31 March 31 March 31 March 31 March 31 March 31 March
2011 2011 2011 20IO 2010 2010 £'000 % % £'000 % %
Eqmt1es 102,249 26 85 172,734 47 8 50 Hedge Funds 47,414 13 85 Fixed Interest G1lts 17,945 5 42 16,777 5 4 50 Index Lmked Gills 33,541 9 42 28,918 8 4 50 Corporate Bonds 149,447 39 55 140,701 39 5 50 Cash 30,358 8 05 5,786 I 0 50
Total market value of assets 380,954 100 6 I 364,916 100 6 70
The overall expected return on assets IS calculated as the weighted average of the expected returns on each mdividual asset class The expected returns are set by reference to market md1cators, mcludmg pnce mflation, d1v1dend yields, economic growth, yields on mdex hnked g1lts and bonds and mterest rates The actual return on plan assets was a gam of £24,650,000 (20 I 0 gam £86,588,000)
36
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Group Group Group Group Group History of expenence gains and losses 2011 2010 2009 2008 2007
£'000 £'000 £'000 £'000 £'000
Present value of defined benefit hab1hty (356,785) (356,681) (275,681) (297,851) (334,469) Fair value of scheme assets• 380,954 364,916 294,790 350,225 355,846 Effect of restnct10n Imposed {2,266) {14,498) Surplus 21,903 8,235 19,109 37,876 21,377
Experience gams/(losses) on scheme liabilities and changes in assumphons :
Amount 8,668 (80, 127) 25,602 42,533 3,498 Percentage of present value of scheme
habihties 24% (22 5%) 93% 14 3% 10% Difference between expected and actual return on scheme assets:
Amount 1,296 66,899 (62,123) (16,626) (5,351) Percentage of scheme assets 03% 18 3% (21 I%) (4 7%) (I 5%)
• The fa.r value of scheme assets •s shown at bid value at 31 March 2011, 2010 and 2009 and at mid-market value at all other dates
lndustrv-wide schemes
The Former Registered Dock Workers Pension Fund ("FRDWPF")
The FRDWPF IS an mdustry w1de defined benefit pensiOn scheme As at 5 Apnl 20 I 0, the date of the most recent valuation earned out by an mdependent actuary, the scheme had assets With a market value of £662 mdhon, representmg I 02% of the benefits accrued to members As at 5 Apnl 20 I 0, approximately 11% of the scheme's assets were mvested m UK eqmties, 6% m diversified growth funds, 58% m mdex-lmked or corporate bonds, 24% m g1lts and I% m cash The valuation assumptions adopted by the actuary at the time of the most recent valuatiOn were as follows
InflatiOn Rate of mcrease of pensionable salanes Rate of mcrease for pensiOns m payment Rate of mcrease for deferred pensions Discount rate
%
3 82 4 82 3 00 3 80 4 69
Because the Group 1s unable to Identify Its share of the scheme assets and habihtles on a consistent and reasonable basis, as perrmtted by FRS 17 "Retirement benefits", the scheme IS accounted for by the Group as If the scheme was a defined contributiOn scheme, the cost recognised w1thm the profit and loss account bemg equal to the contnbut1ons payable to the scheme for the year
Dunng the year the Group made contnbut10ns of £6,000 (20 10 £ 10,000) to th1s scheme m relatiOn to Its current active members and has recorded those as defined contnbution costs With m the profit and loss account
37
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
Merchant Navy Officers Pensmn Fund ("MNOPF")
The MNOPF IS an mdustry w1de defmed benefit penswn scheme The scheme IS d1v1ded mto two sectwns, the Old Sectwn and the New Sectmn, both of wh1ch are closed to new members The most recent valuation for each section was earned out on 31 March 2009 As at 31 March 2009, the Old Section had assets of £1,113 m1lhon, representmg 89% of the benefits accrued to members, whilst the New Sect1on had assets of £1,547 m1lhon, representmg 68% of the benefits accrued to members as at that date Followmg the prev1ous valuatmn, the trustees undertook court proceedmgs to determme wh1ch employers were hable for the past-serv1ce defic1t for the New Section In 2005, the court estabhshed wh1ch employers were hable for the past-serv1ce defic1t and the trustees adopted an allocation consistent w1th the court rulmg The valuatmn assumptions adopted by the actuary were as follows
lnflatwn Rate of mcrease for pensmns m payment Discount rate - mvestment return on ex1stmg assets
Pre-retlrement - Post-retirement
Old Section %
3 00
4 50
New Section %
3 00 3 00
7 25 4 75
Dunng the year, the Group made contnbutlons of £997,000 (2010 £125,000) m relation to the past-serv1ce defic1t The Group has no current act1ve members m th1s scheme
In the year ended 31 March 2010 the MNOPF New and Old Sections were accounted for as 1f the schemes were defined contnbutmn schemes because the Group was unable to 1dent1ty 1ts share of the schemes' assets and habll1t1es on a consistent and reasonable bas1s Followmg rece1pt of suffic1ent mformatmn to 1dent1ty the Group's share of the MNOPF New Section's scheme assets and hab1ht1es, th1s part of the MNOPF has been accounted for on a defined benefit bas1s m the year ended 31 March 20 I I Consequently, a £I I m1lhon charge has been recorded w1thm the statement of total recogmsed gams and losses for the year At 31 March 2011, the Group's share of the deficit was £0 I m, after contnbutlons m the year totalhng £I 0 milhon were pa1d
Because the Group IS unable to 1dent1fy 1ts share of the scheme assets and habll1t1es of the MNOPF Old Sect1on on a consistent and reasonable bas1s, as permitted by FRS 17 "Retirement benefits", the scheme IS
accounted for by the Group as 1f the scheme was a defined contnbutlon scheme, the cost recogmsed w1thm the profit and loss account bemg equal to the contnbutwns payable to the scheme for the year
The Pilots National Pens1on Fund ("PNPF")
The PNPF IS an mdustry-w1de defined benefit scheme The most recent actuanal valuation, performed by an mdependent actuary, 1s as at 31 December 2004 As at that date, the scheme had assets w1th a market value of £339 m1lhon, representmg 76% of the benefits accrumg to members after allowmg for future mcreases The most recent updated assessment available from the scheme actuary IS at 31 December 2007 The value of the fund had mcreased to £350 mllhon Approxunately 32% of the scheme's assets were mvested m eqmtles, 45% m bonds, w1th the balance bemg held m hedge funds and m cash
The valuatiOn assumptions adopted by the actuary were as follows
InflatiOn Rate of mcrease of pensionable salanes Rate of mcrease for pensmns m payment Rate of mcrease for deferred pensiOns D1scount rate Expected return on plan assets
Pre-retlrement - Post-retirement
38
%
2 90 3 90 2 75 2 75 4 70
7 90 4 80
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
23. PENSION FUNDS (CONTINUED)
The scheme rules have not htstoncally provtded a mechantsm for the allocalton of past·servtce defictts In the absence of an agreement on the allocatton of the past-servtce delicti, the Group ts unable to determme tts share of assets and habthttes for thts scheme on a conststent and reasonable basts As permttted by FRS 17 'Rettrement benefits', the scheme ts accounted for by the Group as tf the scheme was a defined contrtbutmn scheme, the cost recogmsed wtthm the profit and loss account bemg equal to the contrtbuttons payable to the scheme for the year Whtlst the drrectors constder tl hkely that the Group wtll be requtred to fund a share of the delicti of the PNPF, they are currently unable to determme the quanlttrn of any delicti artsmg or the share to be borne by the Group on a conststent and reasonable basts unttl such ttme as legal proceedmgs bemg brought by thtrd parttes agamst the trustee of the PNPF are resolved, formal actuanal valuattons performed, agreement bemg reached on the basts on whtch any delicti wtll be shared between the parttctpatmg competent harbour authonttes and a recovery plan ts agreed Furthermore, the trustee has mdtcated tl wtll not engage wtth the parttctpatmg competent harbour authonttes m relatton to determmmg the quantum of any delicti and the recovery thereof unttl the appeal process ts determmed A key tssue of the appeal process concerns the Judgment as to the responstbthty of competent harbour authonttes wtth self employed ptlots to contrtbute to the scheme delicti
In 2006 the parttctpatmg bodtes for the PNPF agreed a voluntary arrangement to mcrease contnbutmns m order to reduce the delicti The dtrectors agreed to make voluntary contrtbuttons totalhng £3,524,000 payable m mstalments over a 5 year penod In the year ended 31 March 2008, the pensmn fund trustee mtltated legal proceedmgs agamst all parttctpatmg competent harbour authonttes as a means to obtam further contrtbuttons to fund the delicti Although thts voluntary payment plan has lapsed, the provtstOn retamed by the Group as at 31 March 2011 amounted to £2,029,000 (2010 £2,029,000)
24. NOTES TO THE GROUP CASH FLOW STATEMENT
(a) Reconciliation of operatmg profit to net cash m flow from operatmg acltvtltes
Continuing activities Group operatmg profit Dtfference between pensmn charge and cash contnbuttons Deprectalton and amounts wntten off tangtble fixed assets Release of grants to mcome Amorttsatton of goodwtll Exchange dtfferences Profit on dtsposal of ftxed assets Decrease m stocks Increase m debtors Increase/( decrease) m credttors Net cash m flow from contmuing operating activities excludmg amounts due
from group undertakings Increase m short term loans to group undertakmgs
Total net cash mflow from contmuing operating acltvtltes Total net cash mflow from non-operatmg excepltonalttem (note 8)
Cash mflow from operational acttviltes and non-operating excepltonal item
(b) Returns on mvestments and servtcmg of finance Interest received Interest patd Fmance lease mterest patd
2011 £'000
76,833 (2,811) 35,125
(782) 10,105
161 (I ,330)
47 5,622
(3,080)
119,890 915
120,805
120,805
411 (52,488)
(221)
(52,298)
2010 £'000
65,129 (714)
31,816 (793)
10,105 (203)
(1,168) 217
(4,380) (9,941)
90,068 4,517
94,585 164
94,749
619 (50,916)
(314)
(50,611)
39
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
24. NOTES TO THE GROUP CASH FLOW STATEMENT (CONTINUED) 2011 2010
(c) Capital expenditure and financ1almvestment £'000 £'000
Acqmslllon of mvestments (85) Repayments by JOmt venture undertakmgs 130 Payments to acqurre tang1ble fixed assets (31,227) (24,590) Receipts from government grants 51 Receipts from sales of tang1ble fixed assets I 983 1,555
(29,244) (22,939)
(d) Acquisitions and disposals Outflow from d1sposal of mterests m subsidiary undertakmgs 906 Proceeds from d1sposal of mterest m JOmt venture 3,656
906 3,656
(e) Fmancing Repayment of bank loans (893) Repayment of loans from third party undertakmgs (21) (24) Cap1tal element of fmance lease rentals {2,094) {2,532)
(3,008) (2,556)
25. ANALYSIS OF MOVEMENT IN GROUP NET DEBT
As at Other As at I April non-cash Fore1gn 31 March
2010 Cash flow changes Exchange 2011 £'000 £'000 £'000 £'000 £'000
Cash at bank 49,032 6,135 8 55,175
Overdrafts 4 4
49,028 6,139 8 55,175
Debt due withm one year (5,249) I ,515 (3,734) Debt due after one year (l ,213,006) 914 (21,310) (l ,233,402) Fmance leases (4,342) 2,094 (2,248) Cash on short term deposit available only for
redemptiOn of floatmg rate guaranteed loan notes (note 14(d)) 5,249 {1,515) 3,734
{1,217,348) 3,008 (21,310) (I ,235,650)
(I, 168,320) 9,147 (21,310) 8 (I, 180,475)
26. MAJOR NON-CASH TRANSACTIONS
Durmg the year the Group entered mto finance lease arrangements m respect of assets With a total capttal value at the mcepllon of the lease of £ml (20 I 0 £942,000)
The non-cash change of £21,310,000 m note 25 relates to the amorttsatiOn of debt 1ssue costs of £3,050,000 and the change m the termmat1on payment accrued on an mdex-hnked swap of£18,260,000 (note 9)
40
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
l7. CAPITAL COMMITMENTS
Capital expenditure contracted for but not provided for m these financial statements
l8. RELATED PARTY TRANSACTIONS
Related Party
Joint ventures
Cammell Larrd Shiprepairers & ShipbUilders Limited
CL YDEBoyd Fort Wilham Lumted
Estuary Services Limited
VIzag Seaport Private Lumted
Subsidiaries
PortiO Management Services Limited
Transaction
Sales
Purchases
Dividend received
Purchase of fixed assets
Rent received and services provided
Purchases, rent and expenses reimbursed
Repayment of loan
Sales and recharge of expenses
Purchases
Management fees received
Recharges of expenses
Entittes In the Peel Holdings Limited group of companies
lOll lOlO £'000 £'000
1,650 5,409
lOll lOIO £'000 £'000
370 570
(859) (473)
4,566
(I ,292)
85 75
(25)
130
252 217
(I ,068) (934)
133
129
The followmg summarises the transactions during the year between entities m the Peel Ports Group and other divisions of the Peel Holdmgs Limited group of companies The other divisions of Peel Holdmgs are headed by the followmg entities
Peel Holdmgs Land & Property (UK) Limited
Peel Holdmgs (Energy) Limited
Peel Property Partnership
Sales and expenses recharged
Purchases, rent and expenses reimbursed
Purchase of fixed assets
Disposal of fixed assets
Sales
Recharge of expenses
1,209 1,479
(1,743) (1,486)
(60) (430)
60 216
36 37
25 228
Details of ordmary dividends paid to the Immediate holdmg company, Peel Ports Holdmgs (Cl) Limited, are disclosed m the directors' report
41
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
28. RELATED PARTY TRANSACTIONS (CONTINUED)
At the balance sheet date the followmg s1gmficant amounts were owed by I (due to) related part1es
Related Party
Joint ventures
Cammell La1rd Sh1preparrers & ShipbUilders L1m1ted
Estuary Serv1ces L1m1ted
CL YDEBoyd Fort Wllham L1m1ted
Subsidiaries
Portl8 Management Serv1ces L1m1ted
Entities in the Peel Holdings Limited group of compames
2011 2010 £'000
(222)
(96)
26
62
£'000
71
(81)
36
The followmg summanses the year end balances between entitles m the Group and other diVISions of the Peel Holdmgs L1m1ted group of compan1es The other diVISIOns of Peel Holdmgs are headed by the followmg entities
Peel Holdmgs Land & Property (UK) L1m1ted
Bndgewater Canal Trust
(674)
24
4
39
Included m accruals and deferred mcome IS accrued mterest of £2,687,000 (20 I 0 £2,687 ,000) payable to Infrastructure NCo (L1me) SarI and £2,698,000 (2010 £2,698,000) payable to Peel Ports Holdmgs (IOM) L1m1ted
29. OTHER FINANCIAL COMMITMENTS
At 31 March 2011, the Group had annual commitments under non·cancellable operatmg leases as follows
Land and Land and bu1ldings Other bUildings Other
2011 2011 2010 2010 Group £'000 £'000 £'000 £'000
Exp1ry date - wtthm one year 89 3,302 15 7,107 - between two and five years 12 4,388 4,768 - after five years 1,229 297 1,325
1,330 7,987 1,340 11,875
The Company has no annual commitments under non·cancellable operatmg leases
42
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
30. ULTIMATE AND IMMEDIATE HOLDING COMPANY
The d1rectors regard Tokenhouse L1m1ted, a company mcorporated m the Isle of Man, as the ultimate holdmg company and Peel Ports Holdmgs (Cl) L1m1ted, a company registered m the Cayman Islands, as the 1mmed1ate parent company
31. ULTIMATE CONTROLLING PARTY
Tokenhouse L1m1ted 1s controlled by The 1997 B11lown Settlement Trust By v1rtue of 1ts controllmg mterest m Peel Ports Holdmgs (Cl) L1m1ted and the maJoniy votmg power held by the drrectors appomted by that company's 1mmed1ate parent undertakmg, Peel Ports Holdmgs (IOM) L1m1ted, the Company cons1ders The 1997 Btllown Settlement Trust to be the ultimate controlhng party
32. MINORITY INTERESTS
At I Apnl2010 Profit and loss account Disposal of shareholdmg m subs1d1ary undertakmg Net exchange adjustments
Eqmty mmonty mterest at 31 March 2011
33. SUBSEQUENT EVENTS
£'000
301 121 130 (66)
486
On 27 May 2011 the Group acqmred the De Facto 1693 L1m1ted group of compames from RREEF Pan European Infrastructure Two Lux S a r I and Peel Land (No 2) Lrrmted for cash cons1derat10n of £14 m1lhon The De Facto 1693 group owns property m Hebburn, Tyne and Wear, and Falmouth, Cornwall, wh1ch 1t leases to th1rd part1es The acqms1t1on was financed by a £11 m1lhon loan from the Company's 1mmed1ate parent undertakmg, Peel Ports Holdmgs (Cl) L1m1ted, and new loan notes of£ I 5m each 1ssued by the Company to the two mvestor companies m Peel Ports Holdmgs (Cl) L1m1ted
43
PEEL PORTS SHAREHOLDER FINANCECO LIMITED
NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 March 2011
34. PRINCIPAL SUBSIDIARY UNDERTAKINGS AND JOINT VENTURES
Subs1d1ary undertakings
The pnnc1pal subs1d1ary undertakmgs consolidated at 31 March 2011 were as follows
Country of Incorporation Subsidiary
Great Bntam Ardrossan Harbour Company Lumted Great Bntam Btrkenhead Port L1m1ted The Netherlands B G Fre1ght Lme Holdmg B V Great Bntam Clydeport Lumted Great Bntam Clydeport Operations L1m1ted Northern Ireland Coastal Contamer Lme L1m1ted Great Bntam Heysham Port L1m1ted Repubhc of Ireland Marme Tennmals L1m1ted Great Bntam Peel Ports Investments L1m1ted Great Bntam Peel Ports L1m1ted Great Bntam Peel Ports Holdmgs L1m1ted Great Bntam Peel Ports Land and Property Investments L1m1ted Great Bntam Peel Ports Operations Lumted Great Bntam Peel Ports UK Fmanceco Lmuted Great Bntam Peel Holdmgs (Ports) Lumted Great Bntam Port of Sheerness L1m1ted Great Bntam Port1a Management Serv1ces Lumted Great Bntam The Manchester Sh1p Canal Company Lumted Great Bntam The Mersey Docks and Harbour Company L1m1ted Northern Ireland TR Sh1ppmg Serv1ces L1m1ted
(1) 100% owned by Clydeport L1m1ted (n) 100% owned by Peel Ports L1m1ted (m) 100% owned by Peel Ports Investments L1m1ted (1v) 100% owned by Peel Ports Operations L1m1ted or Its subs!dl8nes (v) 100% owned by Peel Ports Holdmgs L1m1ted (v1) 100% owned by Peel Holdmgs (Ports) L1m1ted (vn) 100% owned by Peel Ports Intenned•ate Holdco L1m1ted (vm) 100% owned by Peel Ports UK Fmanceco L1m1ted (1x) 65% owned by Peel Ports Operattons Lumted or 1ts subs1d13nes
Jomt ventures
The pnnc1pal JOint ventures, as at 31 March 2011, were as follows
Country of
Prmc1pal activities
Port Fac1ht1es Port Authonty Sh1ppmg Holdmg Company Port Fac1ht1es Sh1ppmg Port Authonty Stevedormg Holdmg Company Holdmg Company Holdmg Company Holdmg Company Holdmg Company Holdmg Company Holdmg Company Operator of a Regtonal Port Port Consultancy Operator of a Reg1onal Port Operator of a Regtonal Port Sh1ppmg Serv1ces
Group
Note
(1) (1v) (1v) (Ill) (1)
(1v) (1v) (1v) (n) (v) (v1) (v1) (Ill) (vn) (v111) (•v) (1x) (Ill) (Ill) (1v)
mcorporation Jomt venture shareholding Principal activities
Great Bntam CL YDEBoyd Fort W•lham L1m1ted 50% Port fac•ht1es
Great Bntam Cammell Lmd Sh1prepa1rers & Sh!pbutlders
4749% Sh1prepamng and
L1m1ted shtp conversions Great Bntam Estuary Services L1m1ted 50% Port fac1ht1es
44