Income Statement on an Adjusted Basis


	March 2005 € m	March 2004 € m
Operating profit	505	296
Net investment income	2	6
Profit before tax	507	302
Taxation	(92)	(64)
Profit after tax	415	238
Minority interests	(2)	-
Net profit of the parent and its subsidiaries	413	238
Share of results of associated company
- British American Tobacco	468	422
Net profit of the Group	881	660

Net investment income was broadly in line with the prior year, in spite of a € 33 million decrease in income relating to the British American Tobacco preference shares which were disposed of in June 2004. This decrease was largely offset by a significant reduction in net interest expense, reflecting the elimination of net debt during the year.

The Group's effective taxation rate for the year declined from 21.2 per cent to 18.1 per cent. Following the completion of a programme to integrate operations, the Group is now more efficiently structured. With both its headquarters and a large element of its manufacturing operations in Switzerland, the Group also benefits from the comparatively low rate of Swiss corporate taxes.