7. Disposal of discontinued operation
a) Profit on disposal of discontinued operation
On 20 November 2006, the Group disposed of its USA business to Grey Mountain Partners for a total
consideration of $51m (£26.999m equivalent) in cash. This generated a Group profit on disposal after tax of
£2.039m. This is calculated as follows:
£000's
26,999
Consideration
(1,672)
Disposal expenses incurred
25,327
Net proceeds from sale
(22,918)
Net assets disposed of
(462)
Recycling of hedging and translation reserve movements from 1 January 2004 to date of disposal
1,947
Profit on disposal of USA business before tax
92
Tax credit on profit on disposal
2,039
Profit after tax on disposal of USA business
b) Profits generated by the discontinued operation up to the date of disposal
The following revenue and profit numbers have been included in the Consolidated Income Statement which
represent the contribution of the USA business up to the date of disposal:
2006
2005
£000's
£000's
65,228
67,884
Revenue
48,480
50,991
Cost of sales
16,748
16,893
Gross profit
12,990
13,885
Operating expenses
3,758
3,008
Operating profit
(16)
12
Net finance (income)/costs
3,774
2,996
Profit before tax
1,124
834
Income tax expense
2,650
2,162
Profit after tax
c) Cash flows from discontinued operation
2006
2005
£000's
£000's
3,535
(128)
Net cash flows from operating activities
(360)
(287)
Net cash flows from investing activities
(1,802)
(1)
Net cash flows from financing activities
1,373
(416)
8. Final dividend
A final dividend of 14.3p per share (2005: 11.5p) has been proposed, taking the full year dividend to 20.5p (2005: 16.8p).
In accordance with IAS 10 "Events after the balance sheet date", dividends declared after the balance sheet date are not
recognised as a liability in the Accounts.