EX-7 37 b744018ex7.htm Prepared and filed by St Ives Burrups

Exhibit 7

Ratio of earnings to fixed charges (unaudited)

Consolidated ratios of earnings to fixed charges calculated in accordance with UK GAAP and US GAAP for the 15 months ended December 31, 2003, for the three months ended December 31, 2002 and 12 months ended December 31, 2003, and the years ended September 30, 2002, 2001, 2000 and 1999 are as follows.

              Year ended September 30  
  Three months ended
December 31, 		   12 months ended
December 31,
   15 months ended
December 31,  		  
 
 
 
 
 
 
 		  
  2002   2003   2003   2002   2001   2000   1999  
UK GAAP 8.9   (a)   (a)   2.0   2.4   2.1   1.5  
US GAAP 8.0   (b)   1.1   2.2   2.1   1.7   (b)  
                           
   
(a) Earnings calculated under UK GAAP were insufficient to cover fixed charges as follows:
     
  12 months ended December 31, 2003 £90 million
     
  15 months ended December 31, 2003 £35 million
     
(b) Earnings calculated under US GAAP were insufficient to cover fixed charges as follows:
     
  12 months ended December 31, 2003 £33 million
     
  Year ended September 30, 1999 £13 million
     

The ratio of earnings to fixed charges was computed by dividing the amount of earnings by the amount of fixed charges. Earnings were calculated by adding:

•      consolidated income from continuing operations before taxes on income;

•      dividend income receivable from associated companies less than 50% owned; and

•      fixed charges;

and then deducting:

•      share of pre-tax income of companies less than 50% owned and

•      the pre-tax value of preferred share dividends payable by our subsidiaries.

Fixed charges are calculated by adding interest on all indebtedness and amortization of debt issues, and the element of rental expense which was deemed to be representative of interest.

 

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  15 months ended December 31, 2003     Three months ended December 31, 2002   12 months ended December 31, 2003    
                                   
      Adjustments           Adjustments         Adjustments      
      from UK to           from UK to           from UK to      
  UK GAAP   US GAAP   US GAAP   UK GAAP   US GAAP   US GAAP   UK GAAP   US GAAP   US GAAP  
 
 
 
 
 
 		  
 
 
 
 
 		  
 
 
 
 
 		  
Income from continuing operations before income taxes
 (35 ) 51   16   55   (6 ) 49   (90 ) 57   (33 )
                                     
Add/(deduct):                                    
   Fixed charges 182    –   182   7    –   7 175   –   175  
 
 
 
 
Earnings 147   51   198   62   (6 ) 56   85   57   142  
 
 
 
 
                                     
Fixed charges:                                    
   Interest expense 160    –   160   2    –   2   158   –   158  
   Estimate of interest with rent expense 22   –   22   5    –   5   17   –   17  
 
 
 
 
Total fixed charges 182   –   182   7   –   7   175   –   175  
 
 
 
 
                                     
Ratio of earnings to fixed charges –       1.1   8.9       8.0   –       –  
                                     
Deficiency in £ 35       –   –       –   90       33  
                                     

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  Year ended September 30  
 
 
      1999           2000           2001           2002      
                                                 
      Adjustments
from UK to
US GAAP		           Adjustments
from UK to
US GAAP		           Adjustments
from UK to
US GAAP		           Adjustments
from UK to
US GAAP		      
                                         
  UK GAAP     US GAAP   UK GAAP     US GAAP   UK GAAP     US GAAP   UK GAAP     US GAAP  
 
 
 
 
 
                                                 
Income from continuing operations before income taxes 114   (124 ) (10 ) 280   (106 ) 174   383   (84 ) 299   191   44   235  

Less:
Income related to equity method investees

 (6 )  –   (6 ) (1 )  –   (1 ) –    –   –   –    –   –  
Add/(deduct):                                                
Fixed charges 211    –   211   257    –   257   283    –   283   196    –   196  
Distributed income of equity method investees 3    –   3   –    –   –   –    –   –   –   –   –  
 
 
 
 
 
Earnings 322   (124 ) 198   536   (106 ) 430   666   (84 ) 582   387   44   431  
 
 
 
 
 
                                                 

Fixed charges:Interest expense

 188    –   188   209    –   209   224    –   224   176    –   176  
Estimate of interest with rent expense 23    –   23   48    –   48   59    –   59   20    –   20  
 
 
 
 
 
Total fixed charges 211   –   211   257   –   257   283   –   283   196   –   196  
 
 
 
 
 
                                                 
Ratio of earnings to fixed charges 1.5       –   2.1       1.7   2.4       2.1   2.0       2.2  
                                                 
Deficiency in £ –       (13 ) –       –   –       –   –       –