The following information has been extracted from the segmental report for 2006 of Carpetright plc, a leading carpet retailer.

Segmental analysis The Group’s primary reporting segment is geographic, as this is the basis on which the Group is organised and managed. The Group does not report a secondary segment on the basis of business operations because business operations throughout the Group are the same. The geographical sectors are: United Kingdom & Republic of Ireland (‘UK & RoI’), and Poland, Belgium and The Netherlands (‘Rest of Europe’).

Central costs are incurred principally in the UK and are immaterial. As such these costs are included within the UK & RoI segment. Segment revenue, expense, result, assets and liabilities include transfers between geographical segments. Such transfers are priced at arm’s length and are eliminated on consolidation.

Analysis by geography:

2006 2005 UK & RoI Rest of Group UK & RoI Rest of Group Europe Europe

£m £m £m £m £m £m Gross Revenue 400.7 53.7 454.4 411.8 53.3 465.1 Inter-segment revenue (3.0) – (3.0) (2.6) – (2.6)

Segment Revenue

(by origin and destination) 397.7 53.7 451.4 409.2 53.3 462.5 Gross profit 241.2 29.7 270.9 245.2 27.8 273.0 Operating profit before exceptional items 55.1 3.6 58.7 60.4 3.0 63.4 Segment result: operating profit after exceptional items 62.6 3.6 66.2 71.4 3.0 74.4 Net interest payable (2.0) (1.9)

Profit before taxation 64.2 72.5 Taxation (20.1) (23.2)

Profit for the financial period 44.1 49.3 Other non-cash expenses:

Depreciation of property, plant and equipment 9.9 2.2 12.1 9.5 2.3 11.8 Depreciation of investment property 0.1 0.3 0.4 – – –

Amortisation of intangible assets 1.1 – 1.1 0.4 – 0.4 Impairment of goodwill – – – 0.5 – 0.5 Share-based payments 0.4 – 0.4 0.2 – 0.2 5.8 5.7 190 EXERCISES 2006 2005 UK & RoI Rest of Group UK & RoI Rest of Group Europe Europe

£m £m £m £m £m £m Segment Assets:

Gross assets (by origin and destination) 163.1 74.8 237.9 151.9 64.2 216.1 Inter-segment balances (0.4) – (0.4) (4.0) – (4.0)

Total segment assets 162.7 74.8 237.5 147.9 64.2 212.1 Segment Liabilities:

Gross liabilities (by origin and destination) 110.0 15.0 125.0 100.9 15.8 116.7 Inter-segment balances – (0.4) (0.4) – (4.0) (4.0)

Total segment liabilities 110.0 14.6 124.6 100.9 11.8 112.7 Capital Expenditure:

Capital expenditure (by origin and destination) 30.8 4.3 35.1 23.6 9.5 33.1 Source: Carpetright plc Annual Report and Accounts 2006.

Required:

Analyse the performance of each of the major segments in so far as the information allows.