EX-7 54 u52625ex7-1.htm  

Exhibit 7.1

UNAUDITED COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES(1)

    Year ended 31 March  
Under IFRS   2007   2006   2005  
    £m   £m   £m  
               
Financing costs per IFRS Consolidated Income Statement   1,612   1,120   880  
One third of rental expense   340   323   303  
   
 
 
 
Fixed charges (IFRS)(2)   1,952   1,443   1,183  
   
 
 
 
               
(Loss)/profit before taxation from continuing operations   (2,383 ) (14,853 ) 7,285  
Share of profit in associated undertakings   (2,728 ) (2,428 ) (1,980 )
Fixed charges   1,952   1,443   1,183  
Dividends received from associated undertakings   791   835   1,896  
Preference dividend requirements of a consolidated subsidiary   (69 ) (74 ) (71 )
   
 
 
 
Earnings (IFRS)   (2,437 ) (15,077 ) 8,313  
   
 
 
 
Ratio of earnings to fixed charges   −   −   7.0  
Deficiency between fixed charges and earnings   (4,389 ) (16,520 ) −  
               
               
    Year ended 31 March  
Under US GAAP(3)   2007   2006   2005  
    £m   £m   £m  
               
Fixed charges (IFRS)   1,952   1,443   1,183  
Effect on financing costs due to proportionate consolidation of joint ventures   36   32   50  
Effect on payments under operating due to proportionate consolidation of joint ventures   (70 ) (74 ) (64 )
   
 
 
 
Fixed charges (US GAAP)   1,918   1,401   1,169  
   
 
 
 
               
Earnings (IFRS)   (2,437 ) (15,077 ) 8,313  
Effect on profit before taxation due proportionate consolidation of joint ventures   2,820   1,534   (2,063 )
GAAP adjustment for connection income   5   10   16  
GAAP adjustment for goodwill and intangible assists   (13,352 ) (14,299 ) (15,534 )
GAAP adjustment for impairment   6,700   15,377   475  
GAAP adjustment for other   1,261   (42 ) 99  
Dividends received from joint ventures   189   65   121  
GAAP adjustment for fixed charges   (34 ) (42 ) (14 )
   
 
 
 
Earnings (US GAAP)   (4,848 ) (12,474 ) (8,587 )
   
 
 
 
Ratio of earnings to fixed charges   −   −   −  
Deficiency between fixed charges and earnings   (6,766 ) (13,875 ) (9,756 )
               
Notes:
1. All of the financial information presented in this exhibit is unaudited
2. Fixed charges include (1) interest expensed (2) amortised premiums, discounts and capitalised expenses related to indebtedness, (3) an estimate of the interest within rental expense, and (4) preference security dividend requirements of a consolidated subsidiary. These include the financings costs of subsidiaries and joint ventures.
3. For discussion of significant differences between IFRS and US GAAP and a reconciliation of net income between amounts calculated under IFRS and under US GAAP, see note 38 to the Condensed Consolidated Financial Statements.