The following are the financial statements for Nailsea plc for the years ended 30 June 2006 and 2007:

Income statement for years ended 30 June 2006 2007

£m £m Revenue 1,230 2,280 Operating expenses (722) (1,618)

Depreciation (270) (320)

Operating profit 238 342 Interest payable – (27)

Profit before taxation 238 315 Taxation (110) (140)

Profit for the year 128 175 Balance sheets as at 30 June 2006 2007

£m £m Non-current assets Property, plant and equipment (at carrying amount)

Land and buildings 1,500 1,900 Plant and machinery 810 740 2,310 2,640 Current assets Inventories 275 450 Trade receivables 100 250 Bank – 118 375 818 Total assets 2,685 3,458 Equity Share capital (fully paid £1 shares) 1,400 1,600 Share premium account 200 300 Retained profits 828 958 2,428 2,858 Non-current liabilities Borrowings – 9% Loan notes (repayable 2011) – 300 Current liabilities Borrowings (all bank overdraft) 32 –

Trade payables 170 230 Taxation 55 70 257 300 Total equity and liabilities 2,685 3,458 There were no disposals of non-current assets in either year. Dividends were paid in 2006 and 2007 of £40m and £45m, respectively.

Required:

Prepare a cash flow statement for Nailsea plc for the year ended 30 June 2007.