Imperial Chemical Industries (ICI)

ICI’s management assesses the underlying performance of its individual businesses by adjusting revenue and operating profit before special items so as to exclude certain other items which would otherwise mask the underlying trend of the business performance. These adjustments relate to the impact of fluctuations in exchange rates used in translating results reported by subsidiaries in foreign currencies into pounds Sterling.

Management’s discussion of the performance of National Starch, Quest, Uniqema, Paints and Regional and Industrial includes data referred to as “constant currency” which excludes the effect of currency translation differences in each of the relevant periods. Management believes that the exclusion of these items provides a better understanding of the underlying operational performance of the Group’s businesses during such periods. Fluctuations in exchange rates are outside of the control of management and may distort the underlying operating performance of the Group’s businesses.

“Constant currency” performance is a non-GAAP financial measure and is one of the key financial measures reported to ICI’s Chief Executive for purposes of assessing segment performance and making decisions about allocating resources to the businesses comprising each segment.