2000-06-01 Final results - year ended 31 March 2000, part 1 (Railtrack plc)

_______________________________________________________________

date 1 June 2000
source Railtrack plc
type Press release

Preliminary Announcement of Results for the year ended 31 March 2000

GROUP PROFIT AND LOSS ACCOUNT
YEAR ENDED 31 MARCH 2000

2000 2000 2000 2000
Note BEFORE EXCEPTIONAL TOTAL TOTAL
EXCEPTIONAL ITEM
ITEM
(NOTE 4)
£M £M £M £M


TURNOVER 2 2,547 - 2,547 2,573

Operating costs 4 (2,123) (61) (2,184) (2,102)
------- ----- ------- -------

OPERATING PROFIT 424 (61) 363 471
Profit on sale of properties 56 - 56 28
Net interest payable (59) - (59) (71)
------ ----- ------- ------

PROFIT ON ORDINARY ACTIVITIES 421 (61) 360 428
BEFORE TAXATION
Tax credit/(charge) on profit 5 13 - 13 (3)
on ordinary activities ----- ------ -------- ------

PROFIT ON ORDINARY ACTIVITIES 434 (61) 373 425
AFTER TAXATION
Equity dividends 6 (137) - (137) (133)
RETAINED PROFIT FOR THE 297 (61) 236 292
FINANCIAL YEAR ------ ------ -------- ----

EARNINGS/(LOSS) PER SHARE 7 85.3p (12.0p) 73.3p 84.0p
----- ---------- ------ ------

DILUTED EARNINGS PER SHARE 7 71.7p 83.5p

------ ------

All amounts derive from continuing operations.



GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Year ended 31 March 2000
2000 1999

£m £m

PROFIT FOR THE FINANCIAL YEAR 373 425
Revaluation of investment properties 9 19
(net of deferred tax)
Clawback on disposal of investment (11) (10)
properties (net of tax relief) ----- -----

TOTAL RECOGNISED GAINS AND LOSSES FOR 371 434
THE YEAR ----- -----


GROUP BALANCE SHEET
YEAR ENDED 31 MARCH 2000
Note 2000 1999
£m £m

FIXED ASSETS
Tangible assets 7,234 6,186
----- -----
CURRENT ASSETS
Stocks 49 25
----- -----
Debtors - amounts falling due 506 434
within one year
Debtors - amounts falling due after 54 70
more than one year ---- -----
560 504
Investments 568 365
Cash at bank and in hand - 15
------ ------
1,177 909
CREDITORS:amounts falling due within (1,314) (1,128)
one year ------ ------
NET CURRENT LIABILITIES (137) (219)
----- ------
TOTAL ASSETS LESS CURRENT 7,097 5,967
LIABILITIES

CREDITORS: amounts falling due
after more than one year
Convertible debt (391) (390)
Other creditors (2,942) (1,994)
------- ------
(3,333) (2,384)
PROVISIONS FOR LIABILITIES AND (251) (370)
CHARGES ------- ------

NET ASSETS 3,513 3,213
----- ------
CAPITAL AND RESERVES
Called up share capital 128 127
Revaluation reserve 65 98
Other reserves 1,083 1,084
Profit and loss account 2,237 1,904
----- ------
EQUITY SHAREHOLDERS' FUNDS 8 3,513 3,213
---- -----



GROUP CASH FLOW STATEMENT
Year ended 31 March 2000
Note 2000 1999
£m £m

NET CASH INFLOW FROM OPERATING 9 1,123 988
ACTIVITIES ----- ---

RETURNS ON INVESTMENTS AND SERVICING
OF FINANCE
Interest received 49 16
Interest paid (132) (81)
----- ---
NET CASH OUTFLOW FROM RETURNS ON
INVESTMENTS AND SERVICING OF FINANCE (83) (65)
--- ---
TAXATION PAID - (89)
CAPITAL EXPENDITURE --- ---
Purchase of tangible fixed assets (1,546) (1,388)

Sale of tangible fixed assets 132 113
------ -----
NET CASH OUTFLOW FROM CAPITAL (1,414) (1,275)
EXPENDITURE ------ -----

EQUITY DIVIDENDS PAID (114) (42)
----- -----
MANAGEMENT OF LIQUID RESOURCES
Purchase of short-term investments (203) (342)
---- ----
FINANCING
New loans 658 931
Payment of discounts and fees on new (2) (18)
loans
Repayment of loans (31) (126)
Capital element of finance lease 14 12
receipts
Capital grants received 37 38
---- -----
NET CASH INFLOW FROM FINANCING 676 837
---- -----
(DECREASE)/INCREASE IN CASH 10 (15) 12




NOTES TO THE PRELIMINARY ANNOUNCEMENT

1. BASIS OF PRESENTATION
The financial information set out in the preliminary
announcement has been prepared in accordance with applicable
Accounting Standards. The accounting policies adopted are
described in the Group's 2000 statutory accounts and have
been consistently applied in both 1999 and 2000 with the
exception of the change from non-capitalisation of interest
(with the exception of a few clearly defined projects) to
capitalisation. The change in policy has increased the
amount of interest capitalised by £19m to £29m. If the
policy had been applied to the results for the year ended 31
March 1999, the amount of interest capitalised would have
been £9m higher. This is considered to be immaterial and the
results for the year ended 31 March 1999 have not been
restated.

2. TURNOVER
2000 1999
£m £m

Passenger franchise revenue 2,175 2,169
Freight revenue 158 169
Property rental income 135 131
Other income 59 63
Commercial and development property 20 41
sales
----- -----
2,547 2,573
----- -----

All turnover relates to the UK. All profits arose from the
Group's principal activity, the management of the national
rail infrastructure.

3. PERFORMANCE REGIMES
The net effect of the performance regimes on the results of
Railtrack for the year was as follows:

2000 1999
£m £m

Included in turnover
Access charge supplements 35 57
Net bonus from customers 17 16
-- --
52 73
-- --
Included in operating costs
Contract premium paid to suppliers (21) (20)

Net bonus to suppliers (25) (26)

Performance fine (10) -
---- ----

(56) (46)
---- ----

Net effect of the performance regimes (4) 27
--- ----


4. OPERATING COSTS

2000 1999
£m £m
Operating profit is stated after
charging:
Signalling operations (excluding 189 179
maintenance costs and depreciation)
Rentals under operating leases
Plant and machinery 3 -
Other 61 64
Research and development expenditure 1 2
Other production and management expenses 321 302
--- ---
Total production and management expenses 575 547
Property rates 113 110
Electric current for traction 114 117
Infrastructure maintenance 663 694
Depreciation - owned assets
Normal activities 658 634
Exceptional item 61 -
---
719
------ ------
2,184 2,102
------ ------


The depreciation charge for track, based on the Group's asset
maintenance plan, has been revised after discussions with WS
Atkins. This reflects the higher level of annual renewals
expenditure that has been required to maintain the improved
operating capability of the track and a revision of the
renewals strategy. The Group intends to undertake an
exercise to recalculate the level of ongoing AMP depreciation
required to maintain the network across all asset categories
during the year ending 31 March 2001. In view of the size of
the increase in the depreciation charge it has been disclosed
separately as an exceptional item.

Infrastructure maintenance comprises day to day work, mainly
on track, and includes inspections and safety checks. The
1999/2000 infrastructure maintenance charge contains a credit
of £21m following the settlement of contractor claims at
lower than anticipated levels (1998/99 - charge £11m).

One off charges of £8m (1998/99 - £15m) for Year 2000
compliance, £9m (1998/99 - £11m) for business restructuring
and review, the performance fine of £10m and £21m (1998/99 -
£11m) of other costs were incurred for 1999/2000. These
charges did not have any material effect on the tax charge
for the year.


5. TAX (CREDIT)/CHARGE ON PROFIT ON ORDINARY ACTIVITIES

2000 1999
£m £m

Corporation tax at 30% (1998/99 - 31%) (13) 31

Over provision in respect of prior years - (28)

(13) 3
---- ---

The effective tax rate on the profit for the period is less
than 30% principally as a result of the following timing
differences for which deferred taxation has not been
provided:

2000 1999
£m £m

Accelerated capital allowances 102 62
Other timing differences 35 76
--- ---
137 138
--- ---


6. EQUITY DIVIDENDS

2000 1999
£m £m

Interim of 9.3p per ordinary share paid (1998/99 -
8.7P) 47 44
Final of 17.6p per ordinary share proposed 90 89
(1998/99 - 17.6p)
---- ----
Ordinary equity dividends paid and proposed of
26.9p per share 137 133
(1998/99 - 26.3p) ---- ----


7. EARNINGS/(LOSS) PER SHARE
2000 1999
£m £m

Net profit for the financial year before 434 425
exceptional items
Exceptional item (61) -
----- ----
Profit attributable to shareholders 373 425
Interest net of corporation tax saved if the 3.5%
exchangeable bonds 2009 were converted 10 1
---- -----
Earnings taking into account applicable dilutive 383 426
instruments --- -----


2000 1999

Weighted average number of ordinary shares 509 506
(millions)
Dilutive effect of share save scheme (millions) 3 3
Dilutive effect of the 3.5% exchangeable bonds 22 1
2009 (millions)
---- ----
Weighted average number of ordinary shares taking
into account applicable dilutive instruments 534 510
(millions) ---- -----


Earnings per share before exceptional item 85.3p 84.0p
Loss per share on exceptional item (12.0p) -
----- -----
Earnings per share 73.3p 84.0p
----- ------
Diluted earnings per share 71.7p 83.5p
----- -----
The calculation of the dilutive effect of the share save
scheme uses the average share price for 1999/2000 of £10.87
per share (1998/99 - £14.39).


8. RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS

2000 1999
£m £m

Profit for the year 373 425
Dividends (137) (133)
---- ----
236 292

Share dividends 66 40
Revaluation of investment properties (net of 9 19
deferred tax)
Clawback on disposal of properties (net of tax (11) (10)
relief) ---- ----

Net addition to equity shareholders' funds 300 341

Opening equity shareholders' funds 3,213 2,872
----- -----
Closing equity shareholders' funds 3,513 3,213
----- -----
9. RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM
OPERATING ACTIVITIES
2000 1999
£m £m

Operating profit 363 471
Depreciation and amortisation (net of capital 710 626
grants amortised)

Increase in stocks (24) (15)
Increase in debtors (67) (31)
Increase in creditors 239 32
Decrease in provisions (98) (95)

----- -----

Net cash inflow from operating activities 1,123 988
----- ----

10.RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
2000 1999
£m £m

(Decrease)/increase in cash in the (15) 12
year
Cash inflow from increase in debt
lease financing (625) (787)

Cash outflow from increase in liquid 203 342
resources ----- ----

Change in net debt resulting from (437) (433)
New finance leases (22) -
Amortisation of discount (1) -
---- -----
Movement in net debt in the year (460) (433)
Net debt at 1 April (1,271) (838)
------ -----

Net debt at 31 March (1,731) (1,271)
------ ------



11.ABRIDGED ACCOUNTS
The balance sheet at 31 March 2000 and the results and cash
flow and associated notes for the year then ended have been
abridged from the Group's 2000 statutory accounts upon which
the auditors' opinion is unqualified and does not include a
statement under Section 237(2) or (3) of the Companies Act
1985. The statutory accounts will be filed with the
Registrar of Companies in due course.

The figures for the year ended 31 March 1999 have been
extracted from the annual report and accounts which have been
filed with the Registrar of Companies. The auditor's report
on those accounts was unqualified and did not contain any
statements under section 237(2) or (3) of the Companies Act
1985.

12.ISSUE OF THE ANNUAL REPORT AND ACCOUNTS
The 2000 annual report and accounts will be posted to
shareholders on 12 June 2000. Copies may be obtained after
that date by either telephoning the Railtrack Helpline on
0845 7114141 or by contacting Computershare Services PLC, PO
Box 84, Caxton House, Redcliffe Way, Bristol, BS99 7AZ.

13.ANNUAL GENERAL MEETING
The Annual General Meeting of Railtrack Group PLC will be
held at the Barbican Centre on 13 July 2000 at 11.15 a.m.


SHAREHOLDER INFORMATION

FINANCIAL CALENDAR
Ex dividend date for final dividend 7 August 2000
Record date for final dividend 11 August 2000
Annual General Meeting 13 July 2000
Last date for share dividend election 4 September 2000
Final dividend paid 4 October 2000


For more information please call the Railtrack press office on 020 7557 8292/3
All recent press releases can be found on the Railtrack web site at the
following address: http://www.railtrack.co.uk/corporate/notice
an interview with the Chief Executive, Gerald Corbett can be viewed on the
site.

Railhub Archive ::: 2000-06-01 RTK-002