| 12 months to 31st March (£m) | 2004 | Weeks cover |
2005 | Weeks cover |
|
|---|---|---|---|---|---|
| Stock | - Boots The Chemists | (60) | 11 | (29) | 11 |
| - Other | 6 | 8 | |||
| (54) | (21) | ||||
| Debtors | (43) | (49) | |||
| Creditors | - Redundancy provision | 41 | (32) | ||
| - Staff bonus | - | (10) | |||
| - Other | 9 | (6) | |||
| 50 | (48) | ||||
| (47) | (118) | ||||
Working capital growth was £118 million, against £47 million last year.
The increase in stock was half that seen last year as stock holding in BTC started to benefit from the store friendly supply chain programme. Stock cover in BTC was flat at 11 weeks with reductions to stock holdings in back shops offsetting the upward pressure of new store openings and the change in mix to higher average item value products. This is in line with the guidance we gave at the interims.
Trade debtors increased in the year as a result of the growth in the business, particularly in BHI and in Dispensing, and higher prepayments in relation to new stores costs.
The big working capital change from last year however relates to creditors which moved from a £50 million inflow to a £53 million outflow. There are two principal reasons for this swing.
Firstly, £41 million of redundancy provisions were established last year as part of the Getting in Shape programme and £32 million has been utilised during the year.
Secondly, there is less bonus payable to our people in respect of last year's performance and there is, therefore, £10 million less accrual in the March 2005 figures.
The subdued outlook for sales means we have to manage our cash position ever more closely.
Looking forward to the current year, we expect that further reductions in stock holding arising from the supply chain programme will offset the continued working capital demands from new stores and the growth in dispensing and will leave working capital broadly flat in the year.
