| The Directors submit their report and audited financial statements of the Company, International Power plc, and the Group, which includes its subsidiary undertakings, for the year ended 31 December 2001.
The operating and financial review and prospects, the discussion on corporate governance, the environment, health and safety review, the discussion in respect of employees and the remuneration report form part of this report. The audited financial statements are available in the Financial Statements section.
The names and biographical details of the Directors of the Company are given under the Board of Directors section.
The Group's principal activity is the generation of electricity.
The Directors do not propose the payment of a dividend for the year ended 31 December 2001.
During the financial period, International Power and itsmajority-owned subsidiaries donated £602,900 tocharitable causes. Companies in which International Powerhas a minority shareholding donated a further £194,476.Projects supported include the building of a school inPakistan for 240 children. The first phase of this school,including five classrooms, will be ready in August 2002,with completion due in February 2003. The Company also supported LEPRA, the Salvation Army and SCOPE. The Company match-funded staff collections for Children in Need. The Company has a charitable donations policy that is implemented by a charities committee. The Company does not make political donations.
For the period 1 January 2001 to 31 December 2001 expenditure on the research and development programme was zero. We will look to take advantage of technical advances as they arise but, currently, pure research is not a core element of the business of International Power. We continue to seek to develop power stations in the regions in which we operate.
A resolution will be proposed at the 2002 Annual GeneralMeeting (AGM) to renew the authority to purchase aproportion of the Company's shares. An explanation of this and other resolutions being proposed at the 2002 AGM will be given with the Notice of AGM, which will be sent to shareholders during April 2002.
As at the date of this report, the Company is aware of thefollowing interests in 3% or more of the issued sharecapital of the Company.  | | | No. | | % | | | Merrill Lynch | | Investment Managers | | 111,928,823 | | 10.01 | | | Morley Fund | | Management Limited | | 45,782,440 | | 4.10 | | | AXA S.A. | | 40,552,015 | | 3.63 | | | Franklin Resources Inc. | | 34,243,433 | | 3.06 | | | Legal and General | | Investment Management | | Limted | | 34,230,622 | | 3.06 | |
At 31 December 2001, 1,709,084 International Power Ordinary Shares were held in trust for the benefit of current and former employees of the Company. The shares had a nominal value of £854,542 and a market value of £3,460,895. The currently operational employee share plans for which these shares may be utilised are the Profit Sharing Share Scheme, the Restricted Share Plan and the Demerger Share Plan.
The Directors are satisfied that the Company and the Group have adequate resources to continue to operate for the foreseeable future. For this reason, they continue to adopt the 'going concern' basis for preparing the accounts.
A resolution to re-appoint KPMG Audit Plc as auditors of the Company and authorise the Directors to agree their remuneration will be proposed at the AGM.
International Power aims to observe the highest standardsof business practice as both a buyer and a seller ofproducts and services. International Power's averagenumber of days outstanding in respect of trade creditors at31 December 2001 was 34 days. By order of the Board
Stephen Ramsay
Company Secretary | 18 March 2002 | 
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