Index

10. Profit Of The Parent Company
11. Dividends
12. Earnings Per Share
13. Intangible Assets
14. Tangible Fixed Assets
15. Fixed Asset Investments
16. Debtors
17. Current Asset Investments
18. Creditors: Amounts Falling Due Within One Year
19. Creditors: Amounts Falling Due After More Than One Year

10. PROFIT OF THE PARENT COMPANY

The profit of the parent company for the financial year amounted to £86 million (nine months ended 31 December 2000: loss of £116 million). By virtue of Section 230 of the Companies Act 1985, the Company is exempt from presenting a separate profit and loss account.

11. DIVIDENDS

		Year ended 31 December 2001 £m		Nine months ended 31 December 2000 £m
Demerger dividend		-		392

The Group demerger dividend represents the book value of the net assets of the UK energy business as at the date of demerger, which were distributed to shareholders in the form of Ordinary Shares in Innogy Holdings plc.

12. EARNINGS PER SHARE

		Year ended 31 December 2001 Group		Nine months ended 31 December 2000 Continuing operations		Nine months ended 31 December 2000 Group
Earnings/(loss) per share		pence		pence		pence
Basic
Before exceptional items		12.8		5.5		13.5
Exceptional items		0.1		(8.9)		(29.7)
After exceptional items		12.9		(3.4)		(16.2)
Diluted
Before exceptional items		12.5		5.5		13.5
Exceptional items		0.1		(8.9)		(29.7)
After exceptional items		12.6		(3.4)		(16.2)
Basis of calculation
Earnings		£m		£m		£m
Profit attributable to shareholders before exceptional items		143		61		151
Exceptional items		1		(99)		(332)
Profit attributable to shareholders after exceptional items		144		(38)		(181)
Reduction in interest charge assuming conversion of the Convertible US Dollar Bonds 2005		7		-		-
Earnings after exceptional items and taking into account applicable dilutive instruments		151		(38)		(181)
Number of ordinary shares		Million		Million		Million
Basic weighted average number of ordinary shares		1,117.5		1,116.9		1,116.9
Dilutive potential ordinary shares:
Employee share schemes		0.3		-		-
Convertible US Dollar Bonds 2005		83.8		-		-
Weighted average number of ordinary shares taking account of applicable dilutive instruments		1,201.6		1,116.9		1,116.9

13. INTANGIBLE ASSETS

		Goodwill		Negative goodwill		Total
The Group		£m		£m		£m
Cost
At 1 January 2001		8		(34)		(26)
Additions		-		(3)		(3)
Exchange rate differences		-		2		2
At 31 December 2001		8		(35)		(27)
Amortisation
At 1 January 2001		(1)		1		-
Credited in the year		-		1		1
At 31 December 2001		(1)		2		1
Net book value at 31 December 2001		7		(33)		(26)
Net book value at 31 December 2000		7		(33)		(26)

Goodwill arising on the acquisition of joint ventures and associated undertakings is set out in note 15 - fixed asset investments.

14. TANGIBLE FIXED ASSETS

		Freehold		Plant,		Assets in		Total
		land and		machinery		course of
		buildings		and		construction
				equipment
a) The Group		£m		£m		£m		£m
Cost
At 1 January 2001		151		1,490		919		2,560
Additions		2		21		376		399
Subsidiary undertaking acquired		14		183		-		197
Subsidiary undertakings disposed of		(17)		(40)		-		(57)
Reclassifications and transfers		(66)		583		(524)		(7)
Disposals		(2)		(3)		-		(5)
Exchange rate differences		(2)		(46)		18		(30)
At 31 December 2001		80		2,188		789		3,057
Depreciation and diminution in value
At 1 January 2001		16		330		-		346
Provided during the year		3		88		4		95
Subsidiary undertakings disposed of		(4)		(15)		-		(19)
Disposals		-		(2)		-		(2)
Exchange rate differences		-		(11)		-		(11)
At 31 December 2001		15		390		4		409
Net book value at 31 December 2001		65		1,798		785		2,648
Net book value at 31 December 2000		135		1,160		919		2,214

Interest capitalised in the year was £23 million. On a cumulative basis, the net book value of interest capitalised is £80 million.

The total value of land that is not depreciated included within freehold land and buildings was £29 million (31 December 2000: £14 million).

		Freehold		Plant,		Total
		land and		machinery
		buildings		and
				equipment
b) The Company		£m		£m		£m
Cost
At 1 January 2001		1		9		10
Additions		-		3		3
Reclassifications and transfers		1		(4)		(3)
Disposals		(1)		(3)		(4)
At 31 December 2001		1		5		6
Depreciation and diminution in value
At 1 January 2001		1		2		3
Provided during the year		-		2		2
Disposals		(1)		(2)		(3)
At 31 December 2001		-		2		2
Net book value at 31 December 2001		1		3		4
Net book value at 31 December 2000		-		7		7

15. FIXED ASSET INVESTMENTS

		Joint Ventures		Associated undertakings
		Share of		Share of		Goodwill		Other		Total
		net assets		net assets				investments
a) The Group		£m		£m		£m		£m		£m
At 1 January 2001		92		502		136		94		824
Share of post-tax profit		11		76		(4)		-		83
Share of recognised gain		-		2		-		-		2
Distribution and loan repayments		(7)		(52)		-		-		(59)
Disposals		-		(237)		(105)		-		(342)
Exchange rate differences		5		2		(3)		3		7
As at 31 December 2001		101		293		24		97		515

Included within the Group's share of net assets of joint ventures and associated undertakings is net debt of £487 million.

		31 December		31 December
		2001		2000
Group share of associated undertakings' net assets		£m		£m
Share of fixed assets		636		1,108
Share of current assets		198		267
		834		1,375
Share of liabilities due within one year		(117)		(302)
Share of liabilities due after more than one year		(424)		(571)
		(541)		(873)
Share of net assets		293		502

The Group investments that are listed on a recognised stock market are those in Prazská Teplárenská, the Hub Power Company Limited (HUBCO) and Malakoff Berhad. The former is a joint venture, the latter two are associated undertakings.

The Group's share in Prazská Teplarenská was valued at £34 million on the Prague stock market at 31 December 2001 compared with a book value of £65 million.

The Group's share in HUBCO was valued at £54 million on the Karachi and Luxembourg stock markets at 31 December 2001 compared with a book value of £71 million.

The Group's share in Malakoff Berhad was valued at £99 million on the Kuala Lumpur stock market at 31 December 2001 compared with a book value of £131 million.

As a result of circumstances in Kazakhstan whereby International Power plc no longer exercises significant influence over the Karaganda Power Company, and there being no foreseen circumstances in the future where this is likely to change, the investment in the joint venture was reclassified as a trade investment on 1 April 2000. International Power continues to hold 50% of the shares of Karaganda.

Kot Addu Power Company Limited (Kapco), in which International Power holds 36% of the shares, was similarly reclassified as a trade investment on 1 April 2000.

		Subsidiary undertakings				Joint ventures		Associated undertakings
		Investment in		Loans		Investment in		Investment in		Other		Total
										investments
b) The Company		£m		£m		£m		£m		£m		£m
At 1 January 2001		846		1,061		5		454		87		2,453
Additions		605		304		-		-		-		909
Distribution and loan repayments		(1)		(867)		-		-		-		(868)
Disposals		(23)		-		-		(361)		-		(384)
Amortisation		-		-		-		-		(1)		(1)
Impairments		(3)		-		-		-		-		(3)
Reclassifications and transfers		(80)		167		-		(1)		(84)		2
Exchange rate differences		(1)		26		-		-		-		25
As at 31 December 2001		1,343		691		5		92		2		2,133

Details of the principal subsidiary undertakings, associates and joint ventures are provided in note 33.

Within other investments are International Power plc Ordinary Shares held in Employee Share Ownership Plans (ESOPs) to meet the future requirements of the Restricted Share Plan and the Demerger Share Plan (see note 22). At 31 December 2001, the ESOPs held 909,012 International Power plc Ordinary Shares. At 31 December 2001, there were potential awards in respect of 451,710 (31 December 2000: 677,564) Ordinary Shares under the Restricted Share Plan and 269,923 (31 December 2000: 288,359) under the Demerger Share Plan.

16. DEBTORS

				Group				Company
		31 December		31 December		31 December		31 December
		2001		2000		2001		2000
		£m		£m		£m		£m
Amounts recoverable within one year:
Trade debtors		73		41		1		3
Due from subsidiary undertakings		-		-		141		130
Other debtors		44		59		22		28
Other prepayments and accrued income		31		17		3		2
Total amounts recoverable within one year		148		117		167		163
Amounts recoverable after more than one year:
Other debtors		10		15		-		-
Total amounts recoverable after more than one year		10		15		-		-
Total debtors		158		132		167		163

17. CURRENT ASSET INVESTMENTS

				Group				Company
		31 December		31 December		31 December		31 December
		2001		2000		2001		2000
		£m		£m		£m		£m
Current asset investments		47		-		-		-

Current asset investments are primarily short-term money market deposits used for fund management and treasury purposes.

18. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

				Group				Company
		31 December		31 December		31 December		31 December
		2001		2000		2001		2000
		£m		£m		£m		£m
Trade creditors		65		51		2		8
Amounts due to subsidiary undertakings		-		-		358		418
Other creditors		59		57		14		5
Other taxation and social security		6		3		1		1
Corporation taxation		57		28		21		21
Accruals and deferred income		316		131		198		98
Bank loans (secured)		112		37		-		-
71/8% Euro Dollar Bonds 2001		-		51		-		51
Total creditors: amounts falling due within one year		615		358		594		602

The bank loans are secured by fixed and floating charges over the assets of certain subsidiary undertakings.

19. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

				Group				Company
		31 December		31 December		31 December		31 December
		2001		2000		2001		2000
		£m		£m		£m		£m
Accruals and deferred income		5		6		-		-
Other creditors		3		5		-		1
Bank loans (secured):
between one and five years		801		331		-		308
over five years		338		484		-		-
Total bank loans		1,139		815		-		308
61/4% Euro Dollar Bonds 2003		41		40		41		40
2% Convertible US Dollar Bonds 2005		248		235		-		-
Total bonds		289		275		41		40
Total creditors: amounts falling due after more than one year		1,436		1,101		41		349

The bank loans are secured by fixed and floating charges over the assets of certain subsidiary undertakings.

Convertible bonds

On 24 November 2000, International Power (Cayman) Limited, a wholly-owned subsidiary company incorporated in the Cayman Islands, issued US$357 million 2% convertible notes due 2005, convertible into preference shares of International Power (Cayman) Limited at the holder's option, exchangeable for Ordinary Shares of, and unconditionally guaranteed on a senior unsecured basis, by International Power plc.

The notes are convertible into Ordinary Shares of International Power plc at a conversion price of 300p at any time between 4 January 2001 and 23 November 2005. On 12 June 2001, full pre-emption disapplication rights were passed at the 2001 Annual General Meeting. In addition, the convertible bond indenture was amended to eliminate the cash redemption feature such that each bond is now fully convertible into Ordinary Shares. Each US$1,000 principal amount of notes will entitle the holder to convert into an US$1,000 paid up value of preference shares of International Power (Cayman) Limited. Investors may elect to receive their Ordinary Shares in the form of American Depositary Receipts.

The notes may be redeemed at the holder's option at a redemption price of 107.1% of its principal amount, together with accrued and unpaid interest, on 24 November 2003.

If the conversion option is not exercised, the convertible unsecured notes will be redeemed on 24 November 2005 at a redemption price of 112.4% of its principal amount.

Provision is made for the possible premium on redemption and included within the carrying amount of the bonds. At 31 December 2001, the amount accrued was £6 million (31 December 2000: £nil). The finance cost charged in the profit and loss account comprises the aggregate of the coupon on the convertible unsecured notes and the proportion of the premium on redemption that relates to the financial year.