Adjusted earnings per share
We report our adjusted earnings after normal business restructuring costs, which
we treat as operating expenses, but before specific non-recurring costs,
primarily the integration costs relating to significant acquisitions and before
certain non-cash items - principally goodwill amortisation. Non-recurring costs
were integration charges of £10m in 2002 (against £74m in 2001) and a £37m
charge for the cancellation of certain swap contracts following the RTL
disposal. The total goodwill charge was £340m down from £436m in 2001 with an
average remaining life of goodwill of 15 years.
Our adjusted earnings per share fell back in 2001, driven by the sharp cyclical
downturn in business advertising. In 2002, despite the continued advertising
downturn and a weaker dollar exchange rate, we delivered earnings growth of 42%.
In 2003, we expect to continue to grow earnings in double-digits at constant
exchange rates, as we benefit from a further steep decline in internet losses
and some modest improvements from our business integrations.
Looking further out, we should benefit from our leading positions in growth
markets and our ability to harness the benefits of sharing our assets and our
processes. Our aim will be to deliver strong annual earnings improvement at
constant exchange rates.