Receivables on Balance sheet vs CF statement

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Receivables on Balance sheet vs CF statement

Postby mrbean » Sat Jul 05, 2014 9:16 am


Can some help me make sense of Ocado’s latest Half Year results? ... 00199966K/

On the balance sheet Trade and other receivables are showing an increase of 2.6m, whereas on the CF statement they are showing an increase of 8.7m. In Note 10 it says ;

”Included within trade and other receivables is a balance of £6.5 million owed by MHE JV Co”

MHE JV is a joint venture in which they are sharing a depot (CFC2) with their customer Morrisons who they deliver groceries for. Ocado sold the depot to them on a sale & leaseback so they also split the rent 50/50. ie, they are ”reimbursed” by Morrisons on the annual rent ;

”Other income also included £5.0 million of rental income arising from the leasing arrangements with Morrisons for CFC2”

” The investment in MHE JV Co and the sale and leaseback of MHE had a total £5.0 million positive impact on EBITDA with £1.1 million being derived from the Group share of MHE JV Co profit after tax. Together, these equate to the finance costs and depreciation on the leased assets incurred by Ocado and subsequently reimbursed by Morrisons”

For the period its showing this in the notes ;

Assets acquired under finance lease (6.1)

They are also capitalising their development costs ;

”Ocado continues to invest in technology by developing its own software, activities which enable us to retain the intellectual property rights. In the period, £6.6 million (1H 2013: £6.7 million) of internal development costs were capitalised as intangible assets; this was in line with the comparative period as a greater share of costs was treated as non-capitalisable”

Any ideas?

Thanks for any help!
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