Financial Review

• Chief Financial Officer's Review
• Operating Review
• Financial Review
• Consolidated Income Statement
• Consolidated Statement of Recognised Income & Expense
• Consolidated Balance Sheet
• Consolidated Cash Flow Statement
• Segmental Reporting
• Notes
• Auditors' Statement
• IFRS to US GAAP Differences

	Notes	2005 £m	2004 £m
Net cash from operating activities	12	1,090	956
Investing activities
Interest paid		(230)	(239)
Interest received		31	28
Dividends received from associates		11	8
Proceeds on disposal of property, plant and equipment		37	26
Purchases of property, plant and equipment		(298)	(285)
Acquisitions of businesses		(38)	(59)
Acquisitions of associates		(33)	(3)
Net cash assumed on acquisitions		1	1
Sale of investments, associates and subsidiary undertakings		41	11
Acquisitions and disposals		(29)	(50)
Net change in equity investments and money market deposits		(29)	106
Net cash used in investing activities		(507)	(406)
Net cash flow before financing activities		583	550
Financing activities
Dividends paid		(261)	(246)
Dividends paid to minority interests		(7)	(19)
Proceeds of finance leases		1	93
Capital element of finance leases repaid		(21)	(24)
Proceeds on issues of ordinary shares		37	25
Net movement of shares held under Employee Trust		71	29
Proceeds of new borrowings		350	610
Borrowings repaid		(543)	(1,007)
Repayment of non-equity minority interest		(219)	–
Net cash used in financing activities		(592)	(539)
Net (decrease)/increase in cash and cash equivalents		(9)	11
Opening net cash and cash equivalents		284	275
Effect of foreign exchange rates		4	(2)
Less: Net cash and cash equivalents included in discontinued operations		(3)	–
Closing net cash and cash equivalents		276	284

Net cash and cash equivalents includes overdraft balances of £56 million (2004: £41 million).

Ken Hanna
Chief Financial Officer
13 March 2006

The summary financial statement and the amounts disclosed relating to the Directors' remuneration were approved by the Board of Directors on 13 March 2006 and signed on its behalf by Ken Hanna.

The Auditors' opinion on the full financial statements and on the auditable part of the Directors' Remuneration Report was unqualified and did not contain a statement under either Section 237(2) or Section 237(3) of the Companies Act 1985.

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