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This excerpt taken from the ICI 20-F filed Mar 31, 2006. Cash flow This commentary relates to the “Group cash flow statement”, which appears on page 62 under Item 18 “Financial Statements” of this Annual Report on Form 20-F. Net cash inflow from operating activities for 2005 was £359m, £32m higher than 2004, with higher operating profit before special items for the Group, a higher cash inflow from movement in working capital, and lower cash outflows in relation to restructuring, offset by higher cash outflows in relation to taxation and dividends. Net cash flow from investing activities was a cash outflow of £106m, which was lower than 2004 by £135m, due primarily to lower net proceeds from the disposal of businesses. Capital expenditure and financial investment for 2005, of £159m, was £1m higher than the £158m outflow in 2004. Payments in respect of disposals prior to 2004 were £47m, compared with £95m in 2004. Acquisitions expenditure was £23m, compared with £4m in 2004. 23 Net proceeds from disposals were £108m in 2005, compared with £279m in 2004, and comprised £128m gross disposal proceeds (2004 £291m) less expenditure against divestment provisions of £20m (2004 £12m). The sale of National Starch’s Vinamul Polymers business, with gross proceeds of £111m received in the first quarter of 2005, was the major contributor to disposal proceeds. The expenditure against divestment provisions related primarily to the divestments of the Vinamul Polymers business and the Quest Food Ingredients business. Dividend payments to the equity holders of the parent of £91m (2004 £82m) comprised the 2004 second interim dividend and the 2005 first interim dividend. Consequently, the Group’s cash inflow before financing activities for 2005 was £253m, £103m lower than the cash inflow of £356m in 2004. The reduction in Group cash flow resulted primarily from lower proceeds from disposals and higher payments in relation to taxation, partially offset by higher operating profit, improved working capital effectiveness and lower payments in relation to restructuring. |
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