~~SECURITIES~~Information furnished ~~AND~~to ~~EXCHANGE~~the ~~COMMISSION Washington,~~Securities ~~D.C.~~and ~~20549~~Exchange Commission on May 14, 2001

~~FORM~~UNITED STATES SECURITIES AND ~~6-K~~EXCHANGE COMMISSION WASHINGTON, D.C. 20549

FORM 6-K Report of Foreign Issuer

~~Pursuant~~|X| toQUARTERLY ~~Rule~~REPORT ~~13a~~PURSUANT TO RULE 13(a)-16 orOR ~~15d~~15(d)-16 ~~of the~~OF ~~Securities~~THE ~~Exchange~~SECURITIES ~~Act~~EXCHANGE ofACT OF 1934

~~Information~~ ~~furnished~~ For asthe atperiod ~~November~~ended 14March 31, ~~2000~~2001

\|_\|	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to ________________

Commission file number 333-6200

INTERTEK TESTING SERVICES LIMITED
(Exact name of Registrant as specified in its charter)

ENGLAND
(Jurisdiction of incorporation or organization)

25 SAVILE ROW, LONDON, W1S 2ES, ENGLAND
(011) 44-20-7396-3400
(Address of principal executive office)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F)

Form 20-F |X| Form 40-F |_|

(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934)

Yes |_| No |X|

Schedule of Information contained in this report

Intertek Testing Services Limited financial statements for the three months to March 31, 2001

Pages 1 – 36

Intertek Testing Services Limited

(Registrant) 25 Savile Row London, W1S 2ES England (Address of principal executive office)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F)

Form 20-F |X| Form 40-F |_|

Yes |_| No |X|

Schedule of Information contained in this report

Intertek Testing Services Limited financial statements for the nine months to September 30, 2000

Pages 1 - 45

Intertek Testing Services Limited

Business description

We are a leading international organisation engaged in the testing, inspection and certification of manufactured goods and commodities. We ~~currently~~are ~~employ~~organised into four operating divisions, each 9focusing on the testing,~~200~~ ~~people~~inspection and ~~operate~~certification ~~469~~of ~~inspection~~different ~~offices~~manufactured goods and ~~240~~commodities. ~~testing~~Our ~~laboratories~~customer base is diverse and different in each division inand 93includes ~~countries~~retailers, distributors, manufacturers, petroleum companies, traders and governments. WeThe ~~are~~majority ~~organised~~of ~~into~~our ~~four~~work ~~operating~~is ~~divisions,~~on ~~each~~a ~~focusing~~job by job basis except in onour ~~the~~Foreign ~~testing~~Trade Standards (“FTS”) division, ~~inspection~~where ~~and~~over ~~certification~~90% of ~~different~~revenues are ~~manufactured~~from ~~goods~~term contracts. We currently employ over 9,500 people and operate 486 inspection offices and ~~commodities~~255 testing laboratories in 97 countries.

~~Caleb~~ ~~Brett~~We isbelieve athat ~~world~~the ~~leader~~growth of ~~providing~~the ~~independent~~internet ~~assessment~~offers ofsignificant ~~crude~~opportunities to expand our business. Increasingly, ~~oil,~~our ~~petroleum~~customers ~~products,~~are ~~chemicals~~demanding ~~and~~closer ~~agricultural~~integration ~~produce~~between their systems and ours. We ~~Caleb~~are ~~Brett’s~~actively improving our information technology systems to answer these ~~customers~~demands. ~~include~~A ~~oil~~new ordering, inquiry and ~~chemical~~reporting ~~companies~~system ~~and~~is ~~traders~~now online in ~~hydrocarbons,~~the ~~chemicals~~Caleb Brett division (“myCalebBrett.com”). Similar systems will be available in all our divisions in the near future. Other internet based IT initiatives are also underway which will allow our divisions to provide better and ~~agricultural~~more tailored ~~products~~services to our customers.

~~ETL~~ ~~SEMKO~~Although ~~provides~~commodities ~~testing,~~and products ~~certification,~~are ~~supervision~~increasingly ~~and~~being ~~other~~traded ~~services~~via the internet on business-to-business and business-to-consumer ~~manufacturers~~sites, ~~importers,~~the ~~distributors~~rate ~~and~~is ~~retailers.~~far ~~ETL~~less ~~SEMKO~~than ~~tests~~originally ~~and~~expected. ~~certifies~~We ~~telecommunications~~provide ~~and information technology equipment~~testing, ~~consumer electronics~~inspection and ~~heating,~~certification ~~ventilation~~services ~~and~~for ~~air~~many ~~conditioning~~of ~~equipment,~~the ~~medical~~commodities and ~~building~~ products, ~~semiconductors~~traded, ~~commercial~~ensuring ~~food~~that ~~equipment~~customers ~~and~~are ~~industrial~~able to buy products over the ~~machinery.~~internet Inreliably ~~the~~and ~~United~~with ~~States~~confidence. ~~and~~We ~~through~~are aworking ~~49%~~with ~~investment~~sites into ~~Europe,~~ensure ~~ETL~~we ~~SEMKO~~are ~~also~~integrated ~~provides~~into ~~ISO~~their ~~9000~~online buying and ~~ISO~~trading ~~14000~~processes ~~certification~~ and ~~related~~our ~~services~~goal is to be the service partner of choice.

~~Labtest~~ isA ~~one~~description of ~~the largest international providers of testing and~~each ~~inspection~~operating services for textiles, footwear, toys and other consumer products. Through a 50% investment in China and Taiwan, Labtest also certifies the quality of management systems to standards such as ISO 9000 and ISO 14000. Labtest’s customers are retailers, importers and manufacturers. This division ~~has~~is agiven ~~Risk Analysis and Management service — RAM Consulting ™, which allows retailers and manufacturers to minimise the risks associated with their products.~~below:

ForeignCaleb Trade Standards (“FTS”) helps governments, standards bodies and customs departments to check that import duty is properly declared and paid, and that imports of specified products comply with their safety and other standards. FTS inspects, and where appropriate, tests products and commodities in the country of export before they are shipped. FTS also provides a training service for customs officers.Brett

~~Discontinued~~ ~~operation.~~Caleb ~~Despite~~Brett ~~extensive~~was ~~restructuring~~ founded in ~~1999,~~1885 ~~the operating~~and ~~results~~is ~~from~~a ~~our~~joint ~~minerals~~leader ~~testing~~in ~~division,~~the ~~Bondar~~market ~~Clegg,~~for ~~continued~~testing and inspecting crude tooil, bepetroleum ~~unsatisfactory~~products and ~~operations~~chemicals. inWe ~~this~~believe ~~division~~that ~~ceased~~Caleb inBrett ~~Q1 00.~~has ~~The~~strong ~~Bondar~~name ~~Clegg~~recognition ~~businesses~~coupled inwith ~~North~~an ~~and~~international ~~South~~reputation ~~America,~~for ~~Ghana~~reliability and ~~Mali were sold~~ ~~for £1~~confidentiality.5 ~~million.~~Caleb ~~The~~Brett’s ~~operations~~primary inbusiness ~~Eritrea,~~is ~~Guinea~~providing ~~and Burkina Faso were~~independent ~~closed~~verification ~~during~~of ~~Q1 00~~the quality and ~~the~~quantity ~~companies~~of ~~are~~crude ~~being~~oil, ~~liquidated.~~petroleum ~~The~~products ~~disposal~~and ofchemicals ~~fixed assets~~ and, ~~inventory~~to ina ~~the~~lesser ~~African~~extent, ~~operations~~agricultural ~~generated~~produce. ~~proceeds~~Caleb ofBrett issues ~~approximately~~certificates ~~£0.2~~that ~~million.~~are ~~The~~internationally ~~Bondar~~recognized ~~Clegg~~as ~~head~~evidence ~~office~~of inthe ~~Vancouver was~~quality ~~closed~~and onquantity ~~March~~of ~~28,~~those ~~2000~~shipments. ~~and~~Caleb ~~the~~Brett’s ~~employment~~customers ofinclude ~~its~~oil ~~personnel was terminated.~~and ~~The~~chemical ~~operating~~companies ~~results~~and ~~for~~traders ~~Bondar~~with ~~Clegg~~whom upwe tohave ~~the~~well-established ~~date of cessation are reported~~long-term asrelationships. ~~discontinued~~Most inof our ~~financial~~oil ~~statements~~company ~~and~~customers ~~prior~~purchase ~~periods~~services ~~have~~from ~~been reclassified~~Caleb toBrett ~~show~~on a ~~comparable~~job-by-job, ~~historic~~port-by-port ~~trend~~basis. ~~The~~Increasingly ~~costs~~we ofare ~~closing~~finding ~~the operations and~~that ~~the~~we ~~loss~~can onprovide ~~disposal~~added ofvalue ~~the~~to ~~Bondar~~certain ~~Clegg~~customers ~~businesses~~by ~~are~~taking ~~reported~~over astheir ~~a non–operating~~laboratory ~~exceptional~~testing ~~item~~on inan ~~our~~outsourcing ~~financial statements~~basis. ~~The~~We ~~total~~can ~~loss~~provide ~~was~~a ~~£12.2~~testing service which meets ~~million~~the ~~including~~customers’ ~~£6.9~~demands ~~million~~for ofhigh ~~goodwill~~scientific ~~which~~quality ~~was~~and ~~previously~~safety ~~written~~standards ~~off~~at toa ~~reserves.~~lower ~~The cash~~ cost ofthan ~~terminating personnel and closing~~ the ~~operations was~~customer ~~approximately~~can ~~£1.0~~provide ~~million~~in-house.

~~Internet~~ ~~strategy.~~Caleb WeBrett’s ~~believe that the growth of the Internet offers~~activities ~~significant~~in ~~opportunities~~petroleum ~~to grow our business. An increasing number of commodities~~ and ~~products~~chemical testing are ~~being~~divided ~~traded~~into ~~via~~three ~~the Internet and on business~~sub-~~to-business~~divisions: ~~(“B2B”) and business-to-consumer (“B2C”) sites. We provide testing~~Inspection, ~~inspection~~ ~~and~~Inspection ~~certification~~Related ~~services~~Testing ~~for many of the commodities~~ and ~~products~~Free ~~traded, ensuring~~Standing ~~that customers are able to buy products over the Internet reliably and with confidence~~Testing. We are working actively with B2B and B2C sites and we are developing links to customers so that our communications with them are online. We are investing in information technology systems so that we can offer improved online services.

We ~~are~~Inspection of ~~the~~cargoes ~~world~~involves ~~leader~~the orphysical ~~one~~checking, ofsampling ~~the~~and ~~world~~measuring ~~leaders~~of in the ~~testing, inspection~~ ~~and~~quantity ~~certification~~ of ~~products~~a ~~and~~commodity ~~commodities~~at ~~such~~points asof ~~textiles,~~loading ~~toys, consumer goods, electrical goods~~ and ~~products~~unloading, ~~chemicals~~such ~~and~~as ~~petroleum products. There~~seaports, isstorage ~~increasing~~tanker ~~online~~terminals ~~trading in these products~~ and ~~commodities~~the ~~and~~ends ~~our~~of ~~services are~~transportation ~~therefore in demand by online traders and online trading sites~~pipelines.

2 Inspection Related Testing is laboratory testing of samples taken to assess their composition and whether they comply with specifications demanded by customers or by legislation.

~~Management’s~~ ~~discussion~~Free ~~and~~Standing Testing involves the analysis of ~~financial~~samples ~~condition~~unrelated ~~and~~to ~~results~~cargo ofshipments, ~~operations~~including situations where an oil or chemical company or trader outsources its laboratory testing work to Caleb Brett.

~~Operating~~ ~~and financial review~~2

In ~~the~~Caleb ~~following~~Brett ~~discussion~~also ~~we comment on our operating results and financial~~performs ~~condition~~marine ~~for~~surveying ~~the~~and ~~three~~agricultural ~~months~~inspection. toMarine ~~September~~surveying ~~30,~~is ~~2000~~the ~~(“Q3 00”)~~evaluation ~~compared~~of tocargo ~~the three months to September 30~~damage, ~~1999~~primarily ~~(“Q3 99”) and~~for ~~the~~insurance ~~nine~~purposes. ~~months~~Agricultural toinspection ~~September 30, 2000 (“9M 00”) compared~~and totesting is the ~~nine~~physical ~~months to September 30~~sampling, ~~1999 (“9M 99”)~~quantification, ~~followed by~~inspection aand ~~detailed~~testing ~~review~~ of commodities, ~~the~~such ~~performance~~as ofvegetable ~~each~~oils ~~division~~and cotton.

ETL SEMKO

ETL SEMKO tests and certifies electrical and electronic products, telecommunication equipment, building products and heating, ventilation and air conditioning equipment. ETL SEMKO also certifies the quality of management systems to standards such as ISO 9000 in North and South America and Europe. ETL is a long established brand name which traces its origins back to Thomas Edison in the United States. SEMKO is the name of the former state owned certification body in Sweden that we acquired in 1994. ETL SEMKO’s customers include industrial companies such as Adtran, LG Electronics, Ericsson, Matsushita and Electrolux. We also have a number of long-standing relationships with various industry organizations, such as the Air Conditioning and Refrigeration Institute, which has been our customer since 1956. ETL SEMKO’s activities are divided into the following three sub-divisions: Conformity Assessment, Performance and Quality Management Systems.

Conformity Assessment primarily involves the testing of electronic, electrical and building products and telecommunications equipment to allow manufacturers to mark their products with nationally or regionally recognized safety marks and to have their products certified as complying with a number of nationally or regionally recognized standards. These services facilitate the sale of products to markets around the world.

Safety marks owned and issued by ETL SEMKO include “ETL” (United States and Canada), “S” (Europe) and “WH” (United States and Canada). ETL SEMKO is also authorised to apply the “GS” mark (Germany). ETL SEMKO has Notified Body Status in the European Union and also has electro-magnetic compatibility, telephone and other accreditations required for products it tests and certifies. These safety marks and certifications are widely relied upon by manufacturers, retailers and consumers to ensure that products conform to the applicable standards. In some countries and for some products, the safety marks and certifications are a legal requirement. Even when not required by governmental regulation, many manufacturers continue to use our safety marks and testing and certification services to ensure product quality. For example, the “S” mark, which has not been mandatory in Sweden since 1990, continues to be widely used throughout that country and in other European countries, as evidence that a product complies with harmonised European safety standards. ETL SEMKO’s accreditations are held by legal entities that are registered in the various countries in which ETL SEMKO offers its services.

Performance testing is demanded by industry associations to guard against products that might damage consumer confidence in a particular industry. For example, we have been nominated by the Air Conditioning and Refrigeration Institute and the Gas Appliance Manufacturers Association in the United States to verify the accuracy of information provided in the yellow “Energy Guide” labels found on many appliances. We also test individual manufacturers’ products to provide independent competitive performance data, which can then be used for marketing.

Quality Management Systems’ activities involve the certification of the business processes and services of an organization to ISO 9000 and similar standards. Certification involves a company defining and documenting its business processes and standards of service. Companies receiving certifications are subject to regular audits over time as a condition of continuing certification. ETL SEMKO manages this activity within North and South America. In Europe, this activity is performed through an associate company, Dekra, in which we have a 49% holding. In Asia, this activity is carried out within the Labtest division.

Labtest

Labtest is one of the largest international providers of testing and inspection services for textiles, toys, footwear, hardlines and other consumer products. Labtest’s customers are retailers, mainly in North America and Europe, and manufacturers, mainly in Asia. Customers include McDonalds and retailers such as Gap Inc, The Home Depot, Tommy and Hilfiger (HK) Ltd.

Labtest performs testing to ensure that products meet safety standards and the specifications of distributors and retailers. The purchasers typically specify their own quality and performance standards, but may specify nationally recognized standards. Manufacturers operating in developing countries routinely seek such testing and inspection of consumer goods to assist them in selling their products to retailers and distributors in markets such as North America and Europe. Labtest divides its activities into the following sub-divisions, Textiles, Toys, Inspection, Code of Conduct, Quality Management Systems and Risk Analysis and Management:

Textiles testing is principally an activity in which large textile and clothing retailers specify standards for the testing of products at the point of manufacture. Testing is mainly carried out for colour fastness, abrasion resistance, size conformity, shrinkage resistance and flammability. Based on our knowledge of the textile testing market and our competitors, we believe that Labtest is the world leader in textile testing.

Toys testing is mainly to ensure products conform to national and international safety standards. Services include design and packaging evaluation, safety testing, durability testing and performance testing.

Inspection of consumer products primarily involves visual inspection of finished products at the manufacturer’s factory prior to shipment to verify the quantity, quality and basic specification of the products to be shipped. Inspection may be carried out on behalf of the manufacturer or the buyer.

Code of Conduct work has resulted from consumers and pressure groups being increasingly concerned about the social conditions and safety of workers in developed and developing countries. Code of Conduct audit work includes factory tours, document review and employee interviews. Retailers usually commission the audits and we work closely with both manufacturers and retailers to find solutions to any problems identified. The main focus of these audits is the review of child labour conditions, involuntary labour, coercion and harassment, health and safety, working hours, compensation and environmental protection.

Quality Management Systems involves the certification of the business processes and services of an organization to ISO 9000 and similar standards. In China, Hong Kong and Taiwan, Quality Management Systems work is carried out through a partnership with the British Standards Institute. In addition, Quality Management Systems’ activities include testing to standards issued by national and legal health authorities such as the Food and Drug Administration in the United States.

Risk Analysis and Management works with world market leaders to minimize the risk associated with toys, children’s clothes and other consumer products.

Foreign Trade Standards

FTS provides independent pre-shipment inspection services to the governments of developing countries to assist them in the enforcement of customs duties and exchange controls. FTS also provides inspection and testing services to government standards organizations to ensure that imports of specified products meet safety and other national standards. In providing these services, FTS inspects, tests and reviews at source the quantity, quality and price of goods to be shipped, to check that import duties are correctly calculated and that such goods comply with the laws, standards and relevant customs regulations of the importing country. This division also provides customs training services to customs departments. FTS’ customers include the governments of Argentina, Bangladesh, Ecuador, Georgia, Iran, Kenya, Mexico, Mozambique, Nigeria, Uganda and Uzbekistan and the Saudi Arabian Standards Organisation. Some of these contracts may be cancelled at short notice.

In addition to pre-shipment inspection work, FTS also provides a wide range of inspection and expediting activities focused on engineering plants and projects.

Discontinued operation

We sold Bondar Clegg, our minerals testing division, in the first quarter of 2000. The operating results for this division up to the date of sale were reported as discontinued in the financial statements.

Operating and Financial Review and Prospects

The following discussion of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes, and the other financial information included elsewhere in this document. Our consolidated financial statements are prepared in accordance with U.K. GAAP and we discuss in note 8 to the financial statements the principal differences between U.K. and U.S. GAAP as they relate to us. This discussion contains forward-looking statements based on assumptions about our future business. Our actual results could materially differ from those contained in the forward-looking statements.

We set out below a discussion of our operating results and financial condition for the three months to March 31, 2001 (“Q1 01”) compared to the three months to March 31, 2000 (“Q1 00”), followed by a detailed review of the performance of each division.

Impact of exchange rates

Our financial statements are reported in pounds sterling (“~~GBP~~sterling” or “£”). We have ~~135~~144 subsidiary companies, of which ~~124~~133 report in currencies other than ~~GBP~~ sterling. Subsidiaries report in the currency of the country in which they are domiciled, apart from those based in countries where there is hyperinflation, which report in their functional currency, which is U.S. dollars. We translate the results of overseas operations into ~~GBP~~sterling at the cumulative average exchange rates for the period, ~~therefore,~~which causes our results ~~can~~to vary from period to period in ~~because~~line ofwith fluctuations in exchange rates ~~which are unrelated to the underlying operational performance~~.

The tables below show growth rates of Q3Q1 0001 over Q3Q1 ~~99 and 9M~~ 00 ~~over~~ ~~9M 99~~ at actual exchange rates and at comparable exchange rates. The actual growth rate is the percentage change of one period over the prior period where each period is translated into ~~GBP~~sterling using the exchange rates applicable in that period. The comparable growth rate is the percentage change of one period over the prior period where both periods are translated into ~~GBP~~sterling using the prior period’s exchange rates. This reflects the underlying growth in revenues and operating income without the fluctuations caused by changes in translation rates. We do not hedge translation rate exposure.

Over 50% of our revenues and the majority of our borrowings, interest payments and debt repayments are denominated in U.S. dollars or currencies linked to the U.S. dollar, such as the Hong Kong dollar. Where there is material transaction exposure from currency rate movements we take out forward foreign exchange contracts to minimise this exposure.

Summary of results of continuing operations for the three months to March 31, 2001 compared to the three months to March 31, 2000

~~Revenues~~ The table below compares revenues by division for Q1 00 and Q1 01 at actual and comparable exchange rates.

Three months to September 30, 2000 compared to three months to September 30, 1999

Revenues by division	Q1 00	Q1 01	Growth	Actual	Comparable
	£m	£m	£m	%	%

Caleb Brett	34.8	42.6	7.8	22.4	16.4
ETL SEMKO	23.1	26.5	3.4	14.7	7.4
Labtest	19.6	22.8	3.2	16.3	10.2
Foreign Trade Standards	10.6	12.2	1.6	15.1	13.2

Total continuing operations	88.1	104.1	16.0	18.2	12.3

By division	Q3 99	Q3 00	Growth		Actual		Comparable
	£m	£m	£m		%		%
Caleb Brett	36.2	40.7	4.5		12.4		9.7
ETL SEMKO	22.1	25.4	3.3		14.9		8.1
Labtest	19.7	24.1	4.4		22.3		21.8
Foreign Trade Standards	9.9	12.2	2.3		23.2		20.2
Continuing operations	87.9	102.4	14.5		16.5		13.2
Discontinued operation	2.9	—	(2.9	)	(100.0	)	(100.0	)
Total	90.8	102.4	11.6		12.8		9.6

~~Revenues~~ The higher growth rate at actual rates is due to translation gains arising from ~~continuing~~the ~~operations~~strength ~~grew~~of bythe U.S. ~~£14~~dollar and currencies linked to the U.5S. ~~million~~dollar, oragainst 13sterling.2% atIn Caleb ~~comparable~~Brett, ~~rates~~revenues from petroleum inspection and testing grew in ~~Q3 00~~the ~~over~~United ~~Q3 99.~~States primarily ~~The~~due to a sustained period of economic growth ~~was~~that ~~16.5%~~resulted atin ~~actual~~increased ~~rates~~consumption of petroleum products. ~~The~~In ~~higher~~Labtest there was continued growth ~~rate~~in textiles atand ~~actual~~toys ~~rates~~testing isin ~~due~~Asia. toFTS ~~translation~~revenues ~~gains~~in ~~arising~~Q1 01 benefited from new ~~from~~pre-shipment ~~the~~inspection ~~strength~~programmes ofin ~~the~~Bangladesh ~~USD~~and Kenya which started after Q1 00 and ~~currencies~~an ~~linked~~increased tovolume of inspections for the ~~USD,~~Saudi ~~against~~Arabian ~~GBP~~Standards Organisation in Q1 01. FTS revenues in Q1 00 included £0.7 million from ~~All~~its ~~operating~~Technical Services division which was sold in February 2000. Acquisitions in Caleb Brett and ETL SEMKO completed after Q1 00 contributed to the revenue increase in Q1 01.

3 Revenues in Q1 00 and Q1 01 were generated by operations located in the following geographic areas:

divisions contributed to this increase with strong growth in textiles and toys testing in Asia, and petroleum inspection and testing in the United States. Acquisitions in ETL SEMKO after Q3 99 contributed to the growth in Q3 00 and FTS revenues in Q3 00 benefited from new pre-shipment inspection programmes in Nigeria, Bangladesh and Georgia which started after Q3 99.

Revenues by geographic area	Q1 00	Q1 01	Growth	Actual	Comparable
	£m	£m	£m	%	%

Americas	37.1	44.0	6.9	18.6	8.6
Europe, Africa and Middle East	28.1	31.0	2.9	10.3	11.7
Asia and Far East	22.9	29.1	6.2	27.1	19.7

Total continuing operations	88.1	104.1	16.0	18.2	12.3

Revenues infrom ~~Q3 99~~the ~~and~~Americas increased ~~Q3 00~~primarily ~~were~~due ~~generated~~to bystrong ~~subsidiaries~~growth in Caleb Brett in the United States, ~~following~~where ~~geographic~~both ~~areas:~~volumes and prices increased.

By geographic area	Q3 99	Q3 00	Growth	Actual	Comparable
	£m	£m	£m	%	%
Americas	36.1	41.6	5.5	15.2	7.0
Europe, Africa and Middle East	28.1	31.5	3.4	12.1	19.4
Asia and Far East	23.7	29.3	5.6	23.6	15.6
Total continuing operations	87.9	102.4	14.5	16.5	13.2

Revenues from Europe, Africa and the Middle East grew due to acquisitions by Caleb Brett in France and Norway made after Q1 00 and a major laboratory outsourcing contract in the United Kingdom that commenced in March 2000. The revenue growth at actual rates was reduced due to the strength of sterling against other European currencies.

~~Revenues~~ ~~from~~In ~~the~~Asia ~~Americas~~and ~~increased~~the byFar ~~£5.5 million or 7.0% at comparable~~East, ~~rates,~~revenues inincreased ~~Q3 00~~due ~~over~~to ~~Q3 99,~~continued ~~primarily~~growth ~~due~~in totextiles ~~strong~~and ~~growth~~toys testing in ~~Caleb~~Labtest, ~~Brett~~growth ~~and~~in ETL SEMKO in ~~the~~Hong ~~United~~Kong ~~States.~~and ~~The~~China ~~growth~~and ~~rate~~a ~~was~~new ~~15.2%~~FTS atinspection ~~actual~~programme ~~rates~~in ~~due~~Bangladesh. toThe ~~currency~~revenue ~~translation~~growth ~~gains~~at ~~caused~~actual byrates was increased due to the strength of the ~~USD~~Hong Kong dollar against ~~GBP~~ sterling.

Revenues from Europe, Africa and the Middle East grew by £3.4 million or 19.4% at comparable rates, in Q3 00 over Q3 99 largely due to increased revenues from acquisitions in the United Kingdom and Germany and additional revenues from new FTS programmes reported through the United Kingdom. The revenue growth was 12.1% at actual rates due to currency translation losses caused by the strength of GBP against the Euro.

In Asia and the Far East revenues increased by £5.6 million or 15.6% at comparable rates, in Q3 00 over Q3 99 due to strong growth in textiles and toys testing in Labtest and growth in Caleb Brett and ETL SEMKO. The growth rate was 23.6% at actual rates due to currency translation gains as the HKD reflected the strength of the USD against GBP.

Nine months to September 30, 2000 compared to nine months to September 30, 1999

By division	9M 99	9M 00	Growth/		Actual		Comparable
			(decline)
	£m	£m	£m		%		%
Caleb Brett	100.8	115.1	14.3		14.2		12.5
ETL SEMKO	65.8	74.1	8.3		12.6		8.7
Labtest	57.0	68.4	11.4		20.0		18.1
Sub total	223.6	257.6	34.0		15.2		12.8
Foreign Trade Standards	37.4	33.6	(3.8	)	(10.2	)	(11.5	)
Continuing operations	261.0	291.2	30.2		11.6		9.3
Discontinued operation	8.5	0.7	(7.8	)	(91.8	)	(91.8	)
Total	269.5	291.9	22.4		8.3		6.1

Revenues from continuing operations increased by £30.2 million or 9.3% at comparable rates, in 9M 00 over 9M 99. The growth was 11.6% at actual rates. Revenues from Caleb Brett, ETL SEMKO and Labtest increased by 12.8% at comparable rates in 9M 00 over 9M 99, and by 15.2% at actual rates. Revenues in ETL SEMKO in 9M 99 included £2.3 million from our Quality Management operations in Europe. We sold our controlling interest in these operations in March 1999 so their revenues are excluded from April 1999 onwards. Revenues in FTS decreased by £3.8 million in 9M 00 over 9M 99. This comprised an increase of £3.8 million from continuing operations, offset by a decrease of £7.6 million due to our reduced

share of the Nigerian pre-shipment inspection programme and the disposal of our technical services operation in February 2000.

Revenues in 9M 99 and 9M 00 were generated by subsidiaries in the following geographic areas:

By geographic area	9M 99	9M 00	Growth	Actual	Comparable
	£m	£m	£m	%	%
Americas	106.4	119.9	13.5	12.7	7.5
Europe, Africa and Middle East	88.1	90.5	2.4	2.7	7.1
Asia and Far East	66.5	80.8	14.3	21.5	15.4
Total continuing operations	261.0	291.2	30.2	11.6	9.3

Revenues from the Americas increased by £13.5 million or 7.5% at comparable rates, in 9M 00 over 9M 99 primarily due to strong growth in Caleb Brett and ETL SEMKO in the United States. The growth rate was 12.7% at actual rates due to currency translation gains caused by the strength of the USD against GBP.

Revenues from Europe, Africa and the Middle East grew by £2.4 million or 7.1% at comparable rates, in 9M 00 over 9M 99. Revenues in Europe increased due to a new outsourcing contract in Caleb Brett, new businesses acquired in 1999 and 2000 by ETL SEMKO and new pre-shipment inspection programmes in FTS. Revenues in 9M 99 included £8.6 million for the Nigerian pre-shipment inspection programme which was cancelled in Q2 99 and £2.3 million for the ETL SEMKO Quality Management operations. We sold our controlling interest in the Quality Management operations in March 1999 therefore their revenues are excluded from Q2 99 onwards. The revenue growth was 2.7% at actual rates due to currency translation losses caused by the strength of GBP against the Euro.

In Asia and the Far East, the increase in revenues of £14.3 million or 15.4% at comparable rates, in 9M 00 over 9M 99 was primarily due to strong growth in textiles and toys testing in Labtest and the continued growth in Code of Conduct work. Revenues from the ETL SEMKO laboratory in Taiwan also contributed to the growth in revenues. At actual rates, revenues grew by 21.5% in 9M 00 due to currency translation gains as the HKD reflected the strength of the USD against GBP.

Operating costs before exceptional items

Our operating costs principally comprise labour costs, property and equipment rental, depreciation and laboratory consumables. Operating costs on continuing operations ~~have~~ increased by £913.4 9 million or 812.71% at comparable rates, to £8691.7 0 million, in Q3Q1 0001 over ~~Q3 99. In 9M 00 over 9M 99,~~ ~~operating costs have increased by £22~~Q1 00.2 ~~million or 7.7% at comparable rates to £247.9 million.~~ Costs have increased broadly in line with ~~increased~~ growth in revenues.

Operating income before exceptional items

~~Three~~ ~~months~~The totable ~~September~~below ~~30,~~compares operating ~~2000~~income ~~compared~~before toexceptional ~~three~~items ~~months~~by todivision ~~September~~for ~~30,~~Q1 00 ~~1999~~and Q1 01 at actual and comparable exchange rates.

By division	Q3 99		Q3 00		Growth		Actual		Comparable
	£m		£m		£m		%		%
Caleb Brett	3.7		4.9		1.2		32.4		35.1
ETL SEMKO	2.8		3.7		0.9		32.1		25.0
Labtest	5.4		7.5		2.1		38.9		37.0
Foreign Trade Standards	(0.2	)	1.1		1.3		650.0		650.0
Central	(1.1	)	(1.5	)	(0.4	)	(36.4	)	(36.4	)
Continuing operations	10.6		15.7		5.1		48.1		46.2
Discontinued operation	(0.6	)	—		0.6		100.0		100.0
Total	10.0		15.7		5.7		57.0		55.0

Operating income from continuing operations grew by £5.1 million or 46.2% at comparable rates in Q3 00 over Q3 99. At actual rates, the increase was 48.1%. All operating divisions contributed to this growth, particularly Labtest where textile and toy testing in Asia continued to perform strongly and FTS, which turned an operating loss of £0.2 million in Q3 99 into a profit of £1.1 million in Q3 00. The increase in FTS operating income was due to new pre-shipment inspection programmes which commenced after Q3 99. Operating income in Q3 00 also benefited from a new outsourcing contract which Caleb Brett gained in March 2000 and from the strong market for petroleum inspection and testing in the United States.

Operating income by division	Q1 00	Q1 01	Growth	Actual	Comparable
	£m	£m	£m	%	%

Caleb Brett	3.0	3.8	0.8	26.7	23.3
ETL SEMKO	3.6	3.6	—	—	(5.6)
Labtest	4.7	5.4	0.7	14.9	12.8
Foreign Trade Standards	0.7	1.3	0.6	85.7	85.7
Central overheads	(1.0)	(1.0)	—	—	—

Total continuing operations	11.0	13.1	2.1	19.1	15.5

~~Nine~~ ~~months~~Operating income in Caleb Brett increased, primarily due to ~~September~~revenue 30growth and price increases in the United States and acquisitions in Europe. Operating income in ETL SEMKO grew in Asia but declined slightly in Europe and the Americas, ~~2000~~due ~~compared~~to reduced activity and delays in telecommunications equipment testing. Toy and textile testing and Code of Conduct inspections in Asia contributed to ~~nine~~growth ~~months~~in Labtest. The increase in operating income in FTS was mainly attributable to ~~September~~higher ~~30,~~revenues in ~~1999~~Q1 01 over Q1 00.

By division	9M 99		9M 00		Growth		Actual		Comparable
	£m		£m		£m		%		%
Caleb Brett	10.5		12.7		2.2		21.0		21.0
ETL SEMKO	9.2		11.3		2.1		22.8		19.6
Labtest	16.2		20.4		4.2		25.9		22.8
Foreign Trade Standards	2.7		2.8		0.1		3.7		—
Central	(3.3	)	(3.9	)	(0.6	)	(18.2	)	(18.2	)
Continuing operations	35.3		43.3		8.0		22.7		20.1
Discontinued operation	(1.8	)	(0.7	)	1.1		61.1		61.1
Total	33.5		42.6		9.1		27.2		24.5

Exceptional items

Operating income from continuing operations grew by £8.0 million or 20.1% at comparable rates in Q3 00 over Q3 99. At actual rates, the increase was 22.7%. The increase in Labtest is mainly attributable to the continued growth in textile and toy testing in Asia. Caleb Brett benefited from a new outsourcing contract which started in March 2000 and from increased petroleum inspection and testing in the United States. Acquisitions made in 1999 and 2000 contributed to the increase in operating income in ETL SEMKO, together with an increase in telecommunications testing in the United States and improved economies of scale in Hong Kong.

Operating exceptional items	Q1 00	Q1 01
	£m	£m

Continuing operations
Provision against Nigerian FTS invoices	(1.6)	—
Discontinued operation
Environmental EPA costs	(1.0)	—

Total operating exceptional items	(2.6)	—

The exceptional charge of £1.6 million in Q1 00 related to a provision against unpaid invoices issued to the Nigerian government by our FTS division. Payment for these invoices was received later in 2000 and the provision was subsequently reversed. The Nigerian government made regular payments throughout 2000 so we stopped making full provision for unpaid invoices from July 2000 onwards. Payments received in January and March 2001 cleared invoices through October 2000 for the new contract.

~~Exceptional~~ ~~income/(~~The exceptional charge of £1.0 million in Q1 00 related to legal costs) incurred in connection with the ongoing investigation by the Environmental Protection Agency into a discontinued operation in Richardson, Texas. This investigation is discussed in detail later in this report.

Operating exceptional items

Non-operating exceptional items	Q1 00	Q1 01
	£m	£m

Losses on disposal on operations
Caleb Brett – loss adjusting business in Chile	(0.4)	—
FTS – Technical Services business in the United States	(2.6)	—

Total continuing businesses	(3.0)	—
Discontinued operation
Loss on disposal of Bondar Clegg division	(12.1)	—

Total non-operating exceptional items	(15.1)	—

	Q3 99		Q3 00		9M 99		9M 00
	£m		£m		£m		£m
Foreign Trade Standards
Provision against Nigerian invoices	—		(0.5	)	(7.4	)	(3.0	)
Payments received	3.3		10.1		19.4		11.4
Sub total	3.3		9.6		12.0		8.4
Restructuring costs	(0.1	)	—		(2.2	)	—
	3.2		9.6		9.8		8.4
Caleb Brett
Provision against Nigerian invoices	—		—		(0.4	)	—
Payments received	—		—		1.5		—
Provision for EPA fine and costs	—		(1.2	)	—		(1.2	)
	—		(1.2	)	1.1		(1.2	)
Total continuing operations	3.2		8.4		10.9		7.2
Discontinued operation
Environmental EPA	(2.9	)	(1.0	)	(2.9	)	(3.0	)
Total	0.3		7.4		8.0		4.2

~~Operating~~ ~~exceptional~~In ~~items~~Q1 00, —Caleb ~~continuing~~Brett sold ~~operations~~a small loss adjusting business in Chile for a profit of £0.1 million. Goodwill of £0.5 million that was previously written off to reserves was transferred to the profit and loss account, resulting in an exceptional charge of £0.4 million.

~~Due~~ toIn ~~delays~~Q1 00 inFTS ~~receiving~~sold ~~payments from the Nigerian government for our work~~its onTechnical ~~the~~Services ~~Nigerian~~business ~~pre-shipment~~in ~~inspection~~the ~~programmes,~~United inStates ~~1997,~~for weits ~~adopted~~net aassets ~~policy~~value of of£1.0 million. ~~making~~Goodwill ~~full~~of ~~provision against unpaid invoices~~£2.6 million ~~The~~which ~~provision~~was ~~for~~previously ~~each period~~written off to reserves was charged to ~~our~~the profit and loss account ~~as an exceptional cost and the associated debt was removed from working capital. When payments were received~~, ~~they~~resulting ~~were credited as exceptional income~~ in ~~the period in which the cash was received.~~an Aexceptional ~~summary~~charge of ~~the provisions and payments for both FTS and Caleb Brett is given above~~£2.6 million.

In ~~January~~We ~~1999,~~sold weour ~~decided~~minerals ~~to collect inspection fees from exporters before~~testing ~~any~~division, ~~inspections~~Bondar ~~were~~Clegg, ~~performed~~in ~~for~~Q1 00. ~~the~~The ~~Nigerian~~net ~~government~~assets onof ~~the~~businesses ~~understanding~~in North and ~~that~~South ~~these~~America ~~advance~~and ~~payments~~Africa ~~would~~were besold ~~returned~~for to£1.7 million, ~~the~~which ~~exporters~~generated ~~once we had been~~a ~~paid~~net ~~for~~loss ~~those~~of ~~inspections by the Nigerian government. We collected~~ £5.4 .2 million. ~~from~~In ~~exporters~~addition, inwe ~~the~~incurred ~~period~~termination ~~January to March 1999~~ and ~~this amount is~~closure ~~held~~costs inof ~~our balance sheet as advance payments~~£1.0 million. OnAfter ~~March~~deducting ~~31,~~goodwill ~~1999,~~of ~~the Nigerian government cancelled its pre-shipment inspection programmes~~£6. ~~Revenues for the~~9 million ~~existing~~that ~~programmes~~was ~~then~~previously ~~ceased~~written ~~and~~off ~~the Nigerian government’s debt owed~~ to usreserves, on the ~~old~~total ~~programmes~~exceptional ~~was~~loss ~~capped~~was £12.1 million.

In September 2000, we received £8.8 million from the Nigerian government. This cleared invoices issued under the old programme for the period October 1998 through January 1999. The unpaid debt under the old programme is currently £4.8 million, excluding advances from exporters. We anticipate this being settled next year.

On September 1, 1999, the new government in Nigeria re-introduced a pre-shipment inspection programme. Our FTS division is participating in this new programme but in a much smaller capacity than the previous programmes. In 9M 00, the new programme generated revenues of £4.3 million. We received £1.3 million in Q2 00 and a further £1.3 million in Q3 00 in payment of invoices through April 2000, leaving an unpaid debt at September 30, 2000 of £1.7 million. In November 2000, we received a further payment of £0.7 million which cleared invoices through June 2000.

Following the termination of the Nigerian inspection programmes in March 1999, we restructured the FTS division at a cost of £2.2 million in 9M 99. Costs were mostly personnel redundancies and relocation costs.

The oil export-monitoring scheme performed by Caleb Brett was also cancelled by the Nigerian government on March 31, 1999 and we received payment for the remaining debt in Q4 99.

As discussed on page 17, one of our Caleb Brett subsidiaries in the United States has agreed to pay a fine of $1 million (£0.7 million) in relation to an investigation by the Environmental Protection Agency. Legal costs amounting to £0.5 million were incurred throughout 9M 00 and have been charged to exceptional items.

Operating exceptional items — discontinued operation

Although the Environmental division ceased operating in August 1998, the EPA investigation into the issues at the Richardson, Texas laboratory is ongoing and we are continuing to incur legal and other costs. We have charged an additional £1.0 million of operating exceptional costs in Q3 00 in connection with this investigation, making a total charge of £3.0 million for 9M 00. We are pursuing possible rights of recovery against our former parent, Inchcape plc, and are seeking to recover costs from our professional indemnity insurance policy but we have not included a provision for any potential recovery in our financial statements.

Non-operating exceptional items

	Q3 99		Q3 00		9M 99		9M 00
	£m		£m		£m		£m
Caleb Brett
Proceeds from disposal	—		—		—		0.2
Less attributable goodwill	—		—		—		(0.5	)
Total	—		—		—		(0.3	)
Loss on investment in associate	—		(0.1	)	—		(0.1	)
	—		(0.1	)	—		(0.4	)
Foreign Trade Standards
Proceeds from disposal	—		—		—		1.0
Less net assets	—		0.1		—		(1.0	)
Less attributable goodwill	—		—		—		(2.6	)
Total	—		0.1		—		(2.6	)
ETL SEMKO
Proceeds from disposals	0.2		—		3.7		—
Less net assets	(0.1	)	—		(0.1	)	—
Less attributable goodwill	—		—		(1.1	)	—
Total	0.1		—		2.5		—
Total continuing businesses	0.1		—		2.5		(3.0	)
Bondar Clegg
Proceeds from disposals	—		0.2		—		1.7
Less net assets	—		—		—		(6.0	)
Less closure costs	—		(0.1	)	—		(1.0	)
Less attributable goodwill	—		—		—		(6.9	)
Total discontinued operations	—		0.1		—		(12.2	)
Total non-operating items	0.1		0.1		2.5		(15.2	)

The operations of a small company in Thailand in which we had a 49% interest, ceased in April 2000 and our investment was written off, generating a loss of £0.1 million in Q3 00 in the Caleb Brett division. In addition, in Q1 00, Caleb Brett incurred a loss of £0.3 million on the disposal of a loss adjusting business in Chile. The business was sold for £0.2 million, but goodwill of £0.5 million which was previously written off to reserves was charged to the profit and loss account, resulting in an exceptional charge of £0.3 million.

The exceptional loss of £2.6 million in FTS in 9M 00 related to the disposal of the technical services business of FTS in the United States. The business was sold for its net book value of £1.0 million, but goodwill of £2.6 million which was previously written off to reserves was charged to the profit and loss account, resulting in an exceptional charge of £2.6 million.

The exceptional income in ETL SEMKO for 9M 99 is made up of £2.3 million for the sale of the CE Magazine in the United States and £0.2 million for the disposal of 51% of our Quality Management business in Sweden. We used the sale proceeds from these disposals to prepay our Senior Term loans.

The Bondar Clegg division ceased operating in Q1 00. The businesses in North and South America, Ghana and Mali were sold for £1.5 million and we received £0.2 million for the sale of assets in Africa. We incurred termination and closure costs of £1.0 million. The disposals and closure of Bondar Clegg

generated a net loss of £5.3 million. Goodwill of £6.9 million which was previously written off to reserves was charged to the profit and loss account, resulting in an exceptional charge of £12.2 million.

Net interest expense

	Q3 99		Q3 00		Change	9M 99		9M 00		Change
	£m		£m		£m	£m		£m		£m
Senior Subordinated Notes	3.2		3.5		0.3	9.6		10.1		0.5
Parent Subordinated PIK Debentures	2.1		2.6		0.5	6.1		7.3		1.2
Senior Term Loan A	1.3		1.3		—	4.2		3.8		(0.4	)
Senior Term Loan B	0.8		0.8		—	2.3		2.3		—
Senior Revolver	—		0.3		0.3	0.4		0.7		0.3
Other borrowings	0.2		0.4		0.2	0.6		0.7		0.1
Foreign exchange losses	—		—		—	0.1		0.3		0.2
Amortisation of issuing costs	0.5		0.5		—	1.5		1.5		—
Interest receivable	(0.1	)	(0.1	)	—	(0.5	)	(0.3	)	0.2
Net interest expense	8.0		9.3		1.3	24.3		26.4		2.1

Net interest of £9.3 million was charged in Q1 01, an increase of £1.2 million over the charge in Q1 00. This increase was attributable to the Parent Subordinated PIK debentures and to currency differences. New Parent Subordinated PIK debentures have been issued each quarter in lieu of interest payments, causing an increase in the interest charge. The majority of our borrowings are in currencies other than sterling therefore the interest charge is affected by fluctuations in exchange rates.

Apart from the Senior Revolver, our borrowings and interest, are denominated in currencies other than GBP, therefore the changes above are impacted by currency translation differences. The increase in interest expense in Q3 00 over Q3 99 and 9M 00 over 9M 99 is primarily due to the capitalised interest on the Parent Subordinated PIK debentures and increased use of the Senior Revolver during 9M 00.

Income taxes

A The income tax charge in ofQ1 01 was £2.0 6 million, ~~was~~an ~~made~~increase ~~against~~of ~~income in Q3~~£0.8 00million ~~making~~over the ~~a total~~ charge ofin ~~£7.6 million for 9M~~Q1 00. This ~~represents~~represented 4768.24% of income before ~~exceptional~~tax and exceptional items. ~~The charge~~ in 9MQ1 9901 ~~was~~and £581.48% ~~million which~~in ~~was 58~~Q1 00.7% ofThe ~~income~~tax ~~before~~rate ~~exceptional~~was ~~items.~~higher Wethan ~~attribute~~ the ~~reduced~~underlying tax rate inof ~~9M 00~~the ~~over~~territories ~~9M 99~~in towhich ~~the~~we ~~increased~~operate, ~~taxable~~largely ~~income~~due ~~generated~~to our inability into ~~countries~~obtain ~~with~~full ~~lower~~potential tax ~~rates~~relief ~~and~~on tointerest expense in the ~~use~~United ofKingdom and ~~tax~~the United States and on operating losses in ~~countries~~other territories. The location ~~with~~of ~~higher~~taxable profits and deductible expenses has a significant impact on the tax charge ~~rates~~year by year.

~~Because~~ of insufficient operating income in the U.K. we are unable to obtain full tax relief for the interest charged on our Parent Subordinated PIK Debentures. Excluding the PIK interest, the group tax charge was 32.6% of operating income in 9M 00 compared to 35.1% in 9M 99.9

The Internal Revenue Service in the United States has concluded its audit of our Federal Tax Return for 1996 and an additional tax charge of £0.9 million has been agreed. This amount is included in the tax charge for 9M 00.

Operating and financial review by division

We set out below a discussion of the performance of each of our operating divisions for Q3Q1 0001 compared to Q3 Q1 ~~99 and 9M~~ 00 ~~compared to 9M 99~~. The operating income by division given below is before exceptional items.

Caleb Brett

Caleb Brett

Operating results	Q1 00	Q1 01	Growth
	£m	£m	£m

Revenues	34.8	42.6	7.8
Actual growth			22.4%
Comparable growth			16.4%

Operating income	3.0	3.8	0.8
Actual growth			26.7%
Comparable growth			23.3%
Operating margin	8.6%	8.9%

Operating results	Q3 99		Q3 00		Growth		9M 99		9M 00		Growth
	£m		£m		£m		£m		£m		£m
Revenues	36.2		40.7		4.5		100.8		115.1		14.3
Actual growth					12.4	%					14.2	%
Comparable growth					9.7	%					12.5	%
Operating income	3.7		4.9		1.2		10.5		12.7		2.2
Actual growth					32.4	%					21.0	%
Comparable growth					35.1	%					21.0	%
Operating margin	10.2	%	12.0	%			10.4	%	11.0	%

Revenues increased in North America primarily due to a sustained period of economic growth in the United States that has resulted in increased consumption of petroleum products. Growth in the United States is slowing down, although to date this has not impacted our revenues. European revenues in Q1 01 benefited from a full quarter’s income from the outsourcing agreement with BP in the United Kingdom, which commenced in March 2000. Revenues were also boosted by acquisitions made after Q1 00.

~~Revenues~~ inOperating ~~Caleb~~income ~~Brett~~increased due to increased ~~£4.5~~activity, ~~million~~price orincreases ~~9.7%~~in atthe ~~comparable~~United ~~rates in~~States ~~Q3 00~~and ~~over~~the ~~Q3 99~~impact of acquisitions.

Revenues in North America increased in Q3 00 over Q3 99, primarily due to increased consumption of petroleum products in the United States and a new coal sampling and analysis contract in Canada which commenced in Q1 00. Revenues in Europe in Q3 00 suffered from a reduction in agricultural inspections due to the non-continuance of a short term EEC food aid programme. This reduction was partially offset by the revenues from a new outsourcing agreement with B.P. Amoco Oil Analytical Technology in the United Kingdom which commenced in March 2000. Under this agreement, Caleb Brett have formed an alliance with B.P. Amoco whereby Caleb Brett provides analytical testing and other services to B.P. Amoco Oil and other members of the B.P. Amoco group. The expertise of Caleb Brett and B.P. Amoco will be combined in a new centre for excellence that is being set up by Caleb Brett and is expected to be operational in Q4 00. Towards the end of Q3 00, there were consumer led protests against government duties on petrol in France and the United Kingdom, which led to a reduction in the movement and consumption of petroleum products. Revenues in Asia continued to grow, aided by acquisitions made in 1999 and minerals testing in Indonesia that was transferred from the discontinued Bondar Clegg division.

ETL SEMKO

Operating results	Q1 00	Q1 01	Growth
	£m	£m	£m

Revenues	23.1	26.5	3.4
Actual growth			14.7%
Comparable growth			7.4%

Operating income	3.6	3.6	—
Actual growth			—
Comparable growth			(5.6)%
Operating margin	15.6%	13.6%

~~Operating~~ ~~income~~The ~~increased~~revenue ~~£1.2~~increase ~~million~~was attributable orto ~~35.1%~~acquisitions atmade ~~comparable~~after ~~rates, in Q3~~Q1 00, ~~compared~~expansion toin ~~Q3 99~~Asia, ~~largely~~additional work ~~due~~generated toby ~~increased~~new ~~prices~~electro-magnetic testing chambers in the United States and an increase in household and ~~additional~~industrial ~~outsourcing~~testing in Sweden. Revenues in Q1 00 included income from a business-to-customer electrical retailer that ceased trading in April 2000.

~~Revenues~~ in Caleb Brett increased £14.3 million or 12.5% at comparable rates in 9M 00 over 9M 99. The increase was primarily attributable to the strong economy in the United States which led to increased consumption of petroleum products in 9M 00, the new coal contract in Canada, outsourcing business in the United Kingdom, and minerals testing in Asia. The EEC food aid programme generated revenues of £3.0 million in 9M 99 which were not repeated in 9M 00.10

Operating income ~~increased~~decreased at ~~£2.2~~comparable ~~million~~exchange orrates, ~~21%~~mainly atdue ~~comparable~~to ~~rates~~the inclosure of the B2C customer ~~9M 00~~but ~~over~~also ~~9M 99.~~due ~~This~~to ~~increase~~a ~~was~~slow ~~largely~~down ~~driven~~or bydelay ~~increased prices~~ in demand for the ~~United~~testing ~~States~~of heating, ventilation and ~~additional~~air ~~outsourcing~~conditioning ~~business~~equipment in the United ~~Kingdom. Operating~~States ~~income~~and intelecommunications ~~9M 99~~equipment testing, ~~was~~especially ~~boosted~~on bymobile ~~income~~telephones ~~from~~in ~~the~~Europe. ~~EEC~~We ~~food~~also ~~aid~~incurred ~~programme~~start up ~~and~~costs ~~the~~in ~~Nigerian~~Japan ~~oil~~for ~~export~~an ~~monitoring~~acquisition ~~scheme~~made ~~which ceased~~ in ~~1999~~December 2000.

Labtest

Operating results	Q1 00	Q1 01	Growth
	£m	£m	£m

Revenues	19.6	22.8	3.2
Actual growth			16.3%
Comparable growth			10.2%

Operating income	4.7	5.4	0.7
Actual growth			14.9%
Comparable growth			12.8%
Operating margin	24.0%	23.7%

In ~~Q1 00,~~The ~~Caleb~~growth ~~Brett~~in ~~sold~~revenues in aLabtest ~~small~~was ~~loss~~driven ~~adjusting~~by ~~business~~textile and toy testing in ~~Chile~~Asia ~~for~~and to a lesser extent ~~£0.2~~in ~~million~~Europe. ~~This~~We ~~was~~attribute this growth to a ~~non-core~~number ~~activity.~~of Afactors, ~~small~~including ~~loss~~the ~~making~~growth in ~~business~~consumer demand, the migration of manufacturing from the West to Asia and other developing countries, the faster introduction of new products by manufacturers and the increasing demand by consumers for good quality and safe products. Demand for toy testing and Code of Conduct inspections continued to grow strongly in Q1 01. ~~Thailand~~Revenues from textile testing increased in ~~which~~Q1 01 weover ~~had~~Q1 00 abut ~~49%~~compared to ~~interest~~recent years, ~~ceased~~the ~~operating~~rate of growth has slowed in ~~April~~Hong ~~2000~~Kong ~~and~~because business ~~our~~is ~~investment~~moving ~~was~~to ~~written~~China ~~off,~~where ~~generating~~we are expanding our laboratory network. Whilst an economic ~~exceptional~~downturn ~~loss~~in the United States could lead to reduced imports of £0consumer goods, this has not yet started to have a significant impact on the Labtest business.1 We believe that the key business drivers continued to be safety, quality ~~million~~consciousness inof ~~Q3 00~~buyers, new fibres and more designs.

In ~~Q2 00,~~The ~~Caleb~~growth ~~Brett acquired a small business~~ in ~~Norway for £0.2~~operating ~~million~~income ~~and~~in aLabtest ~~share~~was ofmainly afrom ~~business~~toy intesting ~~Iran~~and ~~for~~Code ~~£0.4~~of ~~million.~~Conduct ~~In Q3 00,~~inspections. aOperating ~~further~~income ~~small business~~ in ~~Norway~~Q1 01 was ~~acquired~~impacted ~~for~~by ~~£0.3~~start ~~million.~~up ~~These acquisitions~~costs ~~have~~incurred ~~expanded~~in ~~the~~Shanghai where ~~range~~a ofnew ~~services~~toy ~~and~~testing ~~geographic~~laboratory ~~spread~~was ~~offered to~~opened ~~existing~~at ~~customers~~the ~~and~~end ~~introduced~~of ~~new customers~~2000.

ETL SEMKO

Foreign Trade Standards

Operating results	Q1 00	Q1 01	Growth
	£m	£m	£m

Revenues	10.6	12.2	1.6
Actual growth			15.1%
Comparable growth			13.2%

Operating income	0.7	1.3	0.6
Actual growth			85.7%
Comparable growth			85.7%
Operating margin	6.6%	10.7%

Operating results	Q3 99		Q3 00		Growth		9M 99		9M 00		Growth
	£m		£m		£m		£m		£m		£m
Revenues	22.1		25.4		3.3		65.8		74.1		8.3
Actual growth					14.9	%					12.6	%
Comparable growth					8.1	%					8.7	%
Operating income	2.8		3.7		0.9		9.2		11.3		2.1
Actual growth					32.1	%					22.8	%
Comparable growth					25.0	%					19.6	%
Operating margin	12.7	%	14.6	%			14.0	%	15.2	%

~~Revenues~~ The volume of inspections in ~~ETL~~Saudi ~~SEMKO~~Arabia ~~grew~~increased byin ~~£3.3~~Q1 01 ~~million~~due orto ~~8.1%~~stricter atenforcement ~~comparable~~of ~~rates~~the pre-shipment inprogramme ~~Q3 00~~by ~~over~~the ~~Q3 99~~Saudi Arabian Standards Organisation. ~~Acquisitions~~New ~~made~~pre-shipment inspection programmes in ~~1999~~Bangladesh and ~~2000~~Kenya that commenced after Q1 00 also contributed to ~~this~~the increase. Revenues in Q1 00 included £0.7 million from the Technical Services business that was sold in February 2000.

The ~~ETL~~increase ~~SEMKO operation~~ in ~~the~~FTS ~~United Kingdom was expanded by the acquisition~~operating ofincome anwas ~~electrotechnical~~mainly ~~safety~~attributable ~~and~~to ~~electro~~higher ~~magnetic~~revenues ~~compatibility~~but ~~testing~~also ~~business in May 1999 and the acquisition of~~ a ~~radio~~reduction ~~communications~~in ~~testing operation~~operating incosts, ~~March~~especially ~~2000~~in Argentina. ~~American~~The ~~revenues~~new ~~increased~~Kenyan ~~through~~programme ~~the~~which ~~acquisition~~commenced ~~of Integral~~in ~~Sciences~~February 2001 ~~Inc~~is innot ~~November~~yet ~~1999~~fully operational and ~~revenues~~start inup ~~Taiwan~~costs ~~increased~~were ~~due to a new~~incurred ~~electro~~in ~~magnetic compatibility testing laboratory which commenced operations this year~~Q1 01.

OperatingCentral income in Q3 00 increased by £0.9 million or 25.0% at comparable rates. This was principally due to the above acquisitions and to improved economies of scale in Hong Kong. Our operating company in Sweden has been awarded a refund of pension contributions of approximately £2.8 million. In September 2000, £0.6 million was received in cash and the balance will be deducted from pension contributions over the next six years. A credit of £0.1 million was released to operating income in Q3 00 and the balance will be credited over the next six years.overheads

~~Revenues~~ inCentral ~~ETL~~overheads ~~SEMKO grew by £8.3 million or 8.7% at comparable rates~~comprise inthe ~~9M 00~~costs ~~over~~of ~~9M 99.~~our ~~This~~corporate ~~was~~head ~~due~~office ~~to acquisitions made~~ in ~~1999~~London, ~~and 2000~~our ~~and~~tax ~~to an expansion in the testing~~ and ~~certification~~human ~~of telecommunications~~resources ~~equipment~~team in the United States. ~~Revenues~~and incosts ~~9M 99~~associated ~~included~~with ~~£2.3~~non-trading ~~million~~holding companies. ~~from~~Central ~~our~~overheads ~~Quality~~include ~~Management~~salaries, ~~operations~~property ~~in Europe. In March 1999~~rental, wetravel ~~sold~~and ~~our controlling~~legal ~~interest in these operations~~ and ~~reduced our holding from 51% to~~professional ~~49% as a result of which revenues from these operations are excluded from our group revenues from April 1, 1999~~fees. ~~Without~~They ~~this~~were ~~change~~constant inat ~~accounting, ETL SEMKO revenues would have increased by~~ £101.6 0 million ~~or 12.6% at comparable rates~~ in 9MQ1 0001 ~~over~~and 9MQ1 9900.

Operating income increased £2.1 million or 19.6% at comparable rates in 9M 00 over 9M 99. Operating income in 9M 00 benefited from improved efficiency in Asia, particularly in Hong Kong where operating income has increased over 92% in 9M 00 over 9M 99 and operating margin increased from 20% to 31%.

In Q1 00 we acquired the assets of a small laboratory in Italy from Electrolux for £0.1 million. This laboratory carries out electro magnetic compatibility testing for Electrolux and others, providing us with a facility in the fast growing Italian market.

In Q1 00 we acquired the Radio Communications Testing operation of ERA Technology in the United Kingdom for £0.1 million. This operation was merged into our existing facility at Leatherhead and has enabled us to enter the mobile telephone handset testing market in the United Kingdom. Capital expenditure of £1.0 million was required to upgrade the testing facility and equipment.

Labtest

Operating results	Q3 99		Q3 00		Growth		9M 99		9M 00		Growth
	£m		£m		£m		£m		£m		£m
Revenues	19.7		24.1		4.4		57.0		68.4		11.4
Actual growth					22.3	%					20.0	%
Comparable growth					21.8	%					18.1	%
Operating income	5.4		7.5		2.1		16.2		20.4		4.2
Actual growth					38.9	%					25.9	%
Comparable growth					37.0	%					22.8	%
Operating margin	27.4	%	31.1	%			28.4	%	29.8	%

Revenues in Labtest grew by £4.4 million or 21.8% at comparable rates in Q3 00 over Q3 99.

The growth in revenues in Labtest is driven by our business in Asia and to a lesser extent in Europe. The growth is wholly organic and we attribute it to a number of factors, including the continually increasing sourcing of consumer goods from Asia and developing countries. The growth appears particularly strong in Q3 00 over Q3 99 as earthquakes in Taiwan and Turkey reduced revenues in Q3 99.

About 40% of Labtest revenues are derived from textiles testing which has grown 28% in Q3 00 compared to Q3 99. We attribute the growth in textiles testing to the trend to source more styles and colour choices to consumers, the increase in the quality consciousness of buyers which leads to more comprehensive testing, and technological advances in the development of new fibres. The volume of toys testing has also continued to grow, with revenues 35% higher in Q3 00 compared to Q3 99. We attribute the growth in toys testing to competition in the retailing sector and to the rise in consumer protection awareness which has resulted in increased safety testing.

Code of Conduct work which is a new sector of inspection in Labtest added £0.8 million to revenues in Q3 00 and is continuing to expand. This work has resulted from consumers and pressure groups being increasingly concerned about the social and safety conditions to which workers in developed and developing countries are subjected. Code of Conduct audit work includes factory inspections, document review and employee interviews.

Operating income in Labtest grew by £2.1 million or 37.0% at comparable rates in Q3 00 over Q3 99. This increase was mainly from textiles and toys testing and from Code of Conduct work. A new inspection office was opened in Bangladesh in September 2000.

Revenues increased by £11.4 million or 18.1% at comparable rates in 9M 00 over 9M 99. Revenues from textiles and toys testing increased £8.5 million in 9M 00 over 9M 99 and Code of Conduct revenues increased by £2.0 million.

Operating income increased £4.2 million or 22.8% at comparable rates in 9M 00 over 9M 99. New businesses opened in 1999 in Morocco, Germany, Spain and Italy, all reported small profits in 9M 00.

Foreign Trade Standards

Operating results	Q3 99		Q3 00		Growth		9M 99		9M 00		Growth
											/(decline)
	£m		£m		£m		£m		£m		£m
Revenues	9.9		12.2		2.3		37.4		33.6		(3.8	)
Actual growth					23.2	%					(10.2	)%
Comparable growth					20.2	%					(11.5	)%
Operating (loss)/income	(0.2	)	1.1		1.3		2.7		2.8		0.1
Actual growth					650	%					3.7	%
Comparable growth					650	%					—
Operating margin	(2.0	)%	9.0	%			7.2	%	8.3	%

Revenues in FTS increased by £2.3 million or 20.2% at comparable rates in Q3 00 over Q3 99. This increase is primarily due to new pre-shipment inspection programmes in Nigeria, Georgia and Bangladesh. Revenues in Q3 99 included £1.1 million from the technical services division which was sold in February 2000 and £0.7 million from the Ghanaian pre-shipment inspection programme which ceased in June 2000.

FTS reported operating income of £1.1 million in Q3 00 compared to an operating loss of £0.2 million in Q3 99. This increase was attributable to the new Nigerian pre-shipment inspection programme and to improved profitability in Ecuador and Mozambique.

Revenues in 9M 00 decreased by £3.8 million or 11.5% at comparable rates. Revenues for 9M 99 included £8.6 million from the old Nigerian pre-shipment inspection programme which was cancelled in April 1999 and £3.4 million from the technical services division which was sold in February 2000. Excluding these two factors, revenues increased by £8.2 million in 9M 00 over 9M 99.

Operating income increased by £0.1 million in 9M 00 over 9M 99. Operating income in 9M 99 included £3.5 million from operations which were discontinued in 9M 00.

We are involved in the tender process for new programmes.

Following the cessation of the old Nigerian pre-shipment inspection programmes, we restructured the FTS division at a cost of £2.2 million in 9M 99. We reported these costs as exceptional operating costs in our financial statements and they are excluded from operating income in the above table.

Central costs

Central costs comprise the costs of our corporate head office in London, our tax and human resources team in the United States and costs associated with non-trading holding companies. Principally these costs comprise salaries, property rental, travel and legal and professional fees. Central costs increased by £0.4 million to £1.5 million in Q3 00 over Q3 99 due to increased expenditure on e-commerce and internal audit.

Central costs increased by £0.6 million to £3.9 million in 9M 00 over 9M 99.

Effects of U.S. GAAP adjustments on operating income

Our financial statements have been prepared in accordance with U.K. GAAP which differs in certain significant respects from U.S. GAAP. The most significant differences between U.S. GAAP and U.K. GAAP are described in note 98 of the financial statements.

Financial condition and liquidity

At ~~September 30~~March 31, ~~2000~~2001 we had cash of £3319.6 3 million compared to £2021.2 3 million at December 31, ~~1999~~ 2000.

~~Our~~ ~~operating~~Net ~~activities generated net~~ cash inflow offrom ~~£51.1 million in~~operating ~~9M 00~~activities ~~compared~~includes tooperating ~~£45.1~~income ~~million~~after inoperating ~~9M 99.~~exceptionals, ~~Cash~~before ~~received from~~depreciation ~~the~~and ~~Nigerian~~other ~~government~~non-cash ~~was~~items, ~~£11.4~~as ~~million~~well inas ~~9M 00~~working ~~compared~~capital ~~to £19~~movements.~~4 million~~ ~~received~~Our innet ~~9M 99. Net~~ cash inflow from operating activities ~~includes operating~~decreased ~~income~~by ~~after~~£0.9 million ~~operating~~to £7.1 million ~~exceptionals,~~in ~~before~~Q1 01 ~~depreciation~~compared ~~and~~to ~~other non-cash items~~Q1 00, asprimarily ~~well~~due asto increased investment in working capital ~~movements~~.

We spent £141.1 million on ~~tangible~~legal ~~fixed~~costs ~~assets~~ in 9MQ1 01 (Q1 00: ~~compared~~£1.1 million) in connection with an Environmental Protection Agency investigation in Richardson, Texas. Until this investigation is concluded we will continue to incur legal costs, and we anticipate spending a further £94.17 million. We also spent £0.3 million on legal fees in 9MQ1 ~~99.~~01 ~~This~~(Q1 00: is£nil) ~~mostly~~in ~~expenditure~~connection onwith ~~laboratory~~the two Environmental Protection Agency investigations in Linden, New Jersey and ~~I.T.~~Puerto ~~equipment~~Rico. ~~The~~We ~~increase~~have agreed to settle the Linden investigation by paying a fine of £5.0 .7 million isin instalments ~~mostly~~of £0.3 million in ~~the~~April 2001, ~~ETL~~£0.2 million ~~SEMKO~~in October ~~division~~2001 ~~where~~and £1.0 .2 million ~~was~~in ~~invested~~April 2002. We also anticipate additional legal costs in ~~upgrading~~connection with the ~~testing~~ongoing ~~facilities~~investigation in Puerto Rico. The outcome of the ~~newly~~investigations ~~acquired~~in ~~Radio~~Richardson ~~Communications~~and ~~Testing~~Puerto ~~business~~Rico inis ~~the~~uncertain, ~~United~~and ~~Kingdom~~we are unable to estimate and £1provide for any potential settlement.9 ~~million~~The ~~was~~length ~~spent~~of ontime it ~~acquiring~~will ~~two~~take ~~new~~to ~~electromagnetic~~conclude ~~compatibility~~these investigations is also uncertain, and we may ~~testing~~incur ~~chambers~~additional legal costs in ~~the~~excess ~~United~~of ~~States~~those currently provided.

We spent £15.4 2 million on ~~acquisitions~~tangible fixed assets in 9MQ1 0001 compared to £63.5 1 million in 9MQ1 ~~99. In 9M~~ 00~~, we received £1~~.6 ~~million for the~~This ~~disposal~~is ofmostly ~~Bondar~~expenditure ~~Clegg,~~on ~~the~~laboratory ~~technical services division of FTS~~ and ~~the~~computer ~~Caleb Brett~~equipment. ~~loss~~Expenditure ~~adjusting business~~ in ~~Chile. The closure of Bondar Clegg cost £1.0~~Q1 ~~million~~01 inincluded ~~termination payments. In 9M 99, we received~~ £31.7 3 million for the ~~disposal~~ongoing ofOracle ~~our~~computer ~~Compliance~~project ~~Engineering~~in ~~magazine business and our controlling~~ETL ~~share of ETL~~ SEMKO’s ~~Quality~~in ~~Management~~the ~~business~~United States.

At ~~September~~In ~~30,~~Q1 01 ~~2000,~~we ~~our~~paid ~~total~~deferred consideration ~~borrowings~~of ~~were~~ £~~336~~0.7 5 million ~~less~~for ~~unamortised debt~~an ~~issuance~~acquisition ~~costs~~made ofin ~~£9.1~~2000 ~~million.~~but ~~The~~made no ~~following~~new ~~table~~acquisitions ~~gives~~in athe ~~detailed breakdown:~~quarter.

Borrowings	December 31, 1999 £m		September 30, 2000 £m
Senior Subordinated Notes	126.1		139.0
Senior Term Loan A	61.6		63.2
Senior Term Loan B	34.9		35.8
Senior Revolving Credit Facility	10.4		13.4
Parent Subordinated PIK Debentures	70.1		85.1
Other borrowings	0.6		0.2
Total borrowings	303.7		336.7
Debt issuance costs	(10.0	)	(9.1	)
Net borrowings	293.7		327.6

At March 31, 2001, our total borrowings were £343.8 million less unamortised debt issuance costs of £8.2 million. A detailed description of our borrowings is given in note 3 of our consolidated financial

15 12

statements. Apart from the Revolving Credit Facility, our borrowings are denominated in currencies ~~currencies~~ other than ~~GBP~~sterling, ~~which~~and are therefore affected by exchange rate fluctuations. InOur ~~9M 00,~~total weborrowings ~~made~~increased ~~scheduled~~by ~~repayments~~£13.2 million ofin Q1 01 and £37.4 9 million of ~~our~~the ~~Senior~~increase was due to currency translation. Our Parent Subordinated ~~Term~~PIK ADebentures, ~~Loans~~which ~~and~~are ~~repaid~~denominated £0in U.5S. dollars, increased by £5.4 million in Q1 01. The increase was due to new debentures issued in lieu of ~~other~~interest payments ~~loans~~of £2.8 million and currency translation of £2.6 million. There were no scheduled repayments of the Senior Subordinated Notes ~~and~~or Senior Term A and B Loans in 9MQ1 0001. We ~~drew~~utilised a further £2.9 0 million onof ~~the~~our Revolving ~~Senior~~Credit ~~Revolver~~Facility in 9MQ1 0001, toincreasing ~~fund~~our ~~acquisitions and~~total ~~capital~~drawings ~~expenditure~~to £12.0 million ~~The~~at £8March 31, 2001.8 ~~million~~On weMay 1, ~~received~~2001 inwe ~~cash~~drew ~~from~~a ~~the~~further £8.0 million, ~~Nigerian~~primarily ~~Government~~to atfund the ~~end~~payment of ~~September~~interest ~~2000~~on ~~was~~our ~~used~~Senior toSubordinated ~~repay~~Notes ~~our Senior~~which ~~Revolving~~fell ~~Credit~~due ~~Facility~~on inthat ~~October 2000~~day. ~~Drawings~~We ~~under~~currently have £9.0 million of the facility ~~currently~~available ~~stand~~to ~~at £5~~draw.~~5 million.~~

~~Additional~~ ~~Parent~~In ~~Subordinated~~Q1 01, ~~PIK~~we ~~Debentures~~paid ~~totalling~~interest and finance charges of £71.24 million (Q1 00: £2.0 million) ~~were~~on our ~~issued~~borrowings. inThese ~~lieu~~figures ofexclude ~~cash for~~ interest ~~due~~relating onto the Parent Subordinated PIK Debentures, which was funded by a further issue of debentures in February ~~for~~2001. ~~the~~We ~~periods~~paid ~~set~~dividends ~~out~~of ~~below~~£0.6 million to minority shareholders in Q1 01 compared to £0.7 million in Q1 00.

~~Issue~~ We anticipate that available cash, cash flows from operations and borrowing availability under our Revolving Credit Facility will be sufficient to satisfy our working capital and capital expenditure requirements for the foreseeable future. However, to the extent that we should desire to increase our financial flexibility and capital resources or choose or be required to fund future capital commitments from sources other than operating cash or from borrowings under our existing credit facility, we may consider raising additional capital by increasing the credit facility or through the raising of ~~Parent~~additional ~~Subordinated~~equity. ~~PIK~~There ~~Debentures~~can be no assurance, however, that additional capital will be available to us on acceptable terms, if at all.

Periods of interest	£m
November 2, 1999 to February 1, 2000	2.3
February 2, 2000 to May 1, 2000	2.3
May 2, 2000 to August 1, 2000	2.6
Total	7.2

Our ability to meet our debt repayments in the longer term will depend upon the achievement of our business plan. There can be no assurance that we will generate sufficient cash flow from operations or that future working capital will be available in an amount sufficient to enable us to service our indebtedness, or make necessary capital expenditures.

In ~~9M 00~~order to purchase the business from Inchcape plc, we ~~paid~~raised ~~interest~~finance ~~and~~in ~~finance~~the ~~charges~~form of ~~£13~~Senior Subordinated Notes, Senior Term Loans and Parent Subordinated PIK Debentures.0 ~~million~~Subject ~~(9M 99:~~to ~~£11.4~~the ~~million)~~provisions under which these Loans were made, and subject to certain exceptions and applicable law, there are no restrictions on ~~our~~the ~~borrowings.~~ability ~~These~~of: ~~figures~~(a) ~~exclude~~the ~~interest~~Company or ~~relating~~any of its direct and indirect subsidiaries from paying dividends or making any other distributions or loans or advances to ~~the~~Intertek ~~Parent~~Finance ~~Subordinated~~plc, ~~PIK~~the ~~Debentures~~subsidiary of the Company which ~~was~~issued ~~funded~~the byNotes, ~~further~~or ~~issues~~(b) the direct and indirect subsidiaries of ~~such~~the ~~securities~~Company from paying dividends or making any other distributions or loans or advances to the Company.

We ~~paid dividends of £2.8 million to minority shareholders in 9M 00 compared to £1.6 million in 9M 99.~~13

WeInvestigations anticipate that available cash, cash flows from operations and borrowing availability under our Revolving Credit Facility will be sufficient to satisfy our working capital and capital expenditure requirements for at least the next twelve months. However, to the extent that we should desire to increase our financial flexibility and capital resources or choose or be required to fund future capital commitments from sources other than operating cash or from borrowings under our existing credit facility, we may consider raising additional capital by increasing the credit facility or through the raising of additional equityU. ThereS. canEnvironmental beProtection no assurance, however, that additional capital will be available to us on acceptable terms, if at all.Agency

~~Our~~ ~~ability~~Two ~~to meet our debt repayments in the longer term will depend upon the achievement~~ of our ~~business plan. There can be no assurance that we will~~subsidiary ~~generate~~corporations ~~sufficient~~are ~~cash~~currently ~~flow~~involved ~~from~~in ~~operations~~investigations orby ~~that~~the ~~future~~U.S. ~~working capital~~Environmental ~~will~~Protection beAgency ~~available~~(“EPA”). inDetails anof ~~amount~~each ~~sufficient~~investigation toare ~~enable us to service our indebtedness,~~given ~~or make necessary capital expenditures.~~below:

InCaleb orderBrett to purchase the business from Inchcape plcUSA, we raised finance in the form of Senior Subordinated Notes, Senior Term Loans and Parent Subordinated PIK DebenturesInc. Subject– to the provisions under which these Loans were madeLinden, and subjectNew to certain exceptions and applicable law, there are no restrictions on the ability of: (a) the Company or any of its direct and indirect subsidiaries from paying dividends or making any other distributions or loans or advances to Intertek Finance plc or (b) the direct and indirect subsidiaries of the Company from paying dividends or making any other distributions or loans or advances to the Company.Jersey

16 In February 1997, Caleb Brett, through its routine quality assurance and quality control procedures, discovered evidence of false testing results at the Caleb Brett laboratory in Linden, New Jersey, which involved testing of gasoline to certain standards set by the EPA. In September 1999, the Department of Justice announced that three laboratory supervisors pleaded guilty to criminal charges that they participated in a scheme to falsify chemical analyses of gasoline. Due to the fact that Caleb Brett employees mislead federal investigators about the falsification of data during the investigation, Caleb Brett as a corporation was prosecuted. Under applicable law, Caleb Brett is responsible for certain acts of its employees, even though such acts were not committed with the knowledge or permission of the company.

~~Investigations~~ byThe case was concluded on April 13, 2001, when Caleb Brett USA, Inc was sentenced and required to pay a fine of $1 million to the U.S. ~~Environmental~~Government. ~~Protection~~Half ~~Agency~~of this sum was paid in April 2001, and the remainder is payable in two instalments at six month intervals thereafter. The full amount was fully provided in our financial statements for 2000.

TwoIntertek ofTesting ourServices subsidiary corporations are currently involved in investigations by the U.S. Environmental ProtectionLaboratories, Agency ("EPA")Inc. Details– ofRichardson, each investigation are given below:Texas

~~Caleb~~ ~~Brett~~In ~~USA~~December 1997, Intertek Testing Services Environmental Laboratories, Inc. –(“ITS ~~Linden~~Environmental”) discovered certain discrepancies in reported testing results at its facility in Richardson, ~~New~~Texas. ~~Jersey~~ITS Environmental promptly reported this discrepancy to the EPA and to clients. Civil and criminal investigations are under way. A government investigation at the ITS Environmental facility uncovered further discrepancies beyond those initially discovered and disclosed by ITS Environmental.

In ~~February 1997~~August 1998, ~~Caleb~~ITS ~~Brett~~Environmental sold its laboratory business in Burlington, ~~through~~Vermont ~~its~~U.S.A. ~~routine~~and ~~quality~~St. ~~assurance~~Helens, U.K. and ~~quality~~stopped commercial operations at the laboratory in Richardson. These actions ~~control~~resulted ~~procedures,~~in ~~discovered~~the ~~evidence~~discontinuation of ~~false~~business ~~testing~~at ~~results~~ITS atEnvironmental. ~~the~~This ~~Caleb~~sale ~~Brett~~has ~~laboratory~~not inrelieved ~~Linden,~~ITS ~~New~~Environmental ~~Jersey,~~of ~~which~~any ~~involved~~liability ~~testing~~it ofmay ~~gasoline~~face toas a result ~~certain~~of ~~standards~~these ~~set~~investigations byor ~~the EPA~~otherwise.

In ~~September~~After ~~1999~~commercial operations ceased in August 1998, the ~~Department~~facility was used to reprocess the original data. The reprocessing is complete and the facility is now closed. ITS Environmental developed what it believed to be an effective data screening and reprocessing method. The reprocessing effort was aimed at providing clients with data of known ~~Justice~~quality. ~~announced~~The EPA have advised ITS Environmental that ~~three~~the ~~laboratory~~reprocessing ~~supervisors~~is ~~pleaded~~not ~~guilty~~acceptable to ~~criminal~~the ~~charges~~EPA for clean up or compliance purposes. Nevertheless, ITS Environmental believes that ~~they~~it ~~participated~~can inestablish athe ~~scheme~~scientific integrity of the reprocessing work, which ITS believes confirms that the original data was accurate to ~~falsify~~within ~~chemical~~normally ~~analyses~~accepted limits. This has been confirmed by an independent consultant which specialises in reprocessing of ~~gasoline~~data.

In ~~September~~ITS ~~2000,~~Environmental ~~Caleb Brett USA, Inc pleaded guilty in Federal District~~continues ~~Court in New Jersey~~ to ~~the~~co-operate ~~crime~~fully of conspiracy to make false statements to governmental investigators and agreed to pay a $1 million fine. Full provision for this amount was made in our accounts for Q3 00. The sentencing is scheduled for January 7, 2001 when the final settlement and payment terms will be confirmed. The Court may accept the agreement with the government ~~or impose a fine of a greater or lessor amount. Due to the fact that Caleb Brett employees mislead federal investigators about the falsification of data during the~~ investigation~~, Caleb Brett as a corporation was prosecuted~~. ~~Under applicable law, Caleb Brett is responsible for certain acts of its employees, even though such acts were not committed with the knowledge or permission of the company.~~

We ~~have~~On ~~notified~~December 9, ~~Inchcape~~1999, ~~plc~~a complaint ofwas ~~the~~filed ~~costs~~by a customer in federal court in Chicago, Illinois against Intertek Testing Services Environmental Laboratories, Inc. seeking declaratory judgement and ~~agreed~~damages ~~settlement~~arising from analyses performed between 1991 and ~~are~~1997. On ~~pursuing~~December 17, 1999, a complaint was filed in state court in Kansas City, Missouri, ~~possible~~against ~~rights~~Intertek ofTesting ~~recovery~~Services Limited seeking damages from improper testing and analysis. On January 12, 2000, a third complaint was filed in state court in Los Angeles, California, against ~~Inchcape~~Intertek ~~plc~~Testing ~~under~~Services ~~the~~Limited ~~Share~~and ~~Purchase~~Intertek Testing ~~Deed~~Services Environmental Laboratories, Inc. seeking damages arising for improper testing and analysis and alleging fraud.

~~Intertek~~ ~~Testing Services Environmental Laboratories, Inc. – Richardson, Texas~~14

In ~~December~~On ~~1997~~September 21, ~~Intertek~~2000, the ~~Testing~~U.S. ~~Services~~Department ~~Environmental~~of ~~Laboratories,~~Justice ~~Inc.~~announced that a federal grand jury in Dallas, ~~(“ITS~~Texas ~~Environmental”)~~returned ~~discovered~~an ~~certain~~indictment ~~discrepancies~~of inthirty ~~reported~~counts against thirteen persons who were ~~testing~~formerly ~~results~~employed at ~~its~~Intertek ~~facility~~Testing Services Environmental Laboratories Inc in Richardson, Texas. ~~ITS~~Charges ~~Environmental~~against ~~promptly reported~~the ~~this~~thirteen ~~discrepancy~~persons include conspiracy to ~~the~~commit ~~EPA~~mail ~~and~~fraud, conspiracy to ~~clients.~~present ~~Civil~~false, fictitious and ~~criminal investigations~~fraudulent ~~are~~claims ~~under~~against ~~way.~~the AUnited ~~government~~States ~~investigation~~and atwire ~~the~~fraud. ~~ITS~~The ~~Environmental~~trial ~~facility~~date was adjourned ~~uncovered~~from ~~further~~February 5, ~~discrepancies~~2001 ~~beyond~~to ~~that~~October 12, ~~initially~~2001. ~~discovered~~To ~~and~~date, ~~disclosed~~no criminal charges have bybeen filed against ITS Environmental.

In ~~August~~On ~~1998~~March 23, ~~ITS~~2001, ~~Environmental~~a ~~sold~~Complaint was ~~its~~filed ~~laboratory~~in ~~business~~state court in ~~Burlington~~Marshall, Texas, by 418 individual plaintiffs against ~~Vermont~~Intertek ~~U.S.A.~~Testing ~~and~~Services ~~St.~~Environmental ~~Helens~~Laboratories, UInc.K. and ~~stopped~~thirteen ~~commercial~~former employees ~~operations~~seeking at$80 million ~~the~~in damages. The individual defendants named in ~~laboratory~~the lawsuit are the same people who were indicted in ~~Richardson~~September 2000. ~~These~~The ~~actions~~Complaint alleges ~~resulted~~common infraud, negligent misrepresentation and malice. Plaintiffs previously sued various suppliers to the ~~discontinuation~~Longhorn ofArmy ~~business~~Ammunition Plant (“Longhorn”) atfor personal injury and property damage, and claim here that ITS Environmental’s understated environmental test results for Longhorn caused them to settle for that case for less than they otherwise would have. ~~This~~All ~~sale~~defendants ~~has~~have ~~not~~sought to ~~relieved~~remove ~~ITS~~the ~~Environmental~~case ofto Federal Court and have moved to dismiss the Complaint. Under U.S. law, the plaintiffs can site any ~~liability~~figure they wish for damages in their itComplaint. ~~may~~We ~~face~~believe aswe have a ~~result~~meritorious ofdefense ~~these~~and ~~investigations~~the oroutcome ~~otherwise~~is unlikely to have a material adverse effect on our business and our financial position.

~~After~~ ~~commercial~~All ~~operations~~these ~~ceased~~cases inare ~~August 1998, the facility was used to~~in ~~reprocess~~ the ~~original~~preliminary ~~data.~~stages ~~The~~and ~~reprocessing~~we isare ~~complete~~unable ~~and~~to predict the ~~facility~~outcome isof these actions. ~~now~~We ~~closed.~~are ~~ITS~~unable ~~Environmental~~to ~~developed~~estimate ~~what~~the itcost ~~believed~~of toany becivil anor ~~effective~~criminal penalties arising ~~data~~from ~~screening~~this ~~and~~investigation. ~~reprocessing~~However, ~~method.~~on ~~The~~the ~~reprocessing~~basis ~~effort~~of ~~was~~currently ~~aimed~~available atinformation, ~~providing~~we ~~clients~~consider ~~with~~that ~~data~~the ofoutcome ~~known~~is ~~quality.~~unlikely ~~The~~to ~~EPA~~ have ~~advised~~a ~~ITS~~material ~~Environmental~~adverse effect on ~~that~~our ~~the~~business ~~reprocessing~~and isour ~~not~~financial ~~acceptable~~position. toWe ~~the~~have ~~EPA~~notified ~~for~~Inchcape ~~clean~~plc upof ~~or compliance~~the ~~purposes.~~investigation ~~Nevertheless,~~and ~~ITS~~are ~~Environmental~~pursuing ~~believes~~possible ~~that~~rights itof ~~can~~recovery ~~establish~~against ~~the~~Inchcape ~~scientific~~plc ~~integrity~~under of the ~~reprocessing~~Share ~~work,~~Purchase ~~which~~Deed. ~~ITS~~Our ~~believes~~group ~~confirms~~professional ~~that~~indemnity insurance ~~the~~policy ~~original~~may ~~data~~respond ~~was~~at ~~accurate~~least to ~~within~~legal ~~normally~~costs, ~~accepted~~civil ~~limits.~~damages ~~This~~and ~~has~~third party claims. ~~been~~With ~~confirmed~~our bybroker, anwe ~~independent~~are ~~consultant~~seeking ~~which~~acceptance ~~specialises~~of inthe ~~reprocessing of~~loss ~~data~~by the insurer.

ITSCaleb EnvironmentalBrett continuesUSA, toInc co-operate– fullyPuerto with the government investigation.Rico

OnCaleb ~~December~~Brett 9USA, ~~1999,~~Inc ahas been ~~complaint~~informed ~~was~~that ~~filed~~an investigation is underway by athe ~~customer~~U.S. inDepartment ~~federal~~of ~~court~~Justice Environmental inCrime Section of certain practices at its Puerto Rico facility. ~~Chicago~~The investigation, ~~Illinois~~which ~~against~~relates ~~Intertek~~to ~~Testing~~events ~~Services~~in ~~Environmental~~1997 ~~Laboratories~~and prior, is at a preliminary ~~Inc~~stage and we are unable to predict the outcome or estimate the cost of any civil or criminal penalties that may arise. ~~seeking~~However, ~~declaratory~~on ~~judgement~~the basis of currently available information, we consider that the outcome is unlikely to have a material adverse effect on our business and ~~damages~~our ~~arising~~financial ~~from~~position. ~~analyses~~We ~~performed~~have notified Inchcape ~~between~~plc ~~1991~~of the investigation and ~~1997~~are pursuing possible rights of recovery against Inchcape plc under the Share Purchase Deed. OnThis ~~December~~event ~~17,~~may ~~1999,~~give rise to a ~~complaint~~claim under ~~was~~our ~~filed~~group inprofessional indemnity insurance policy and our brokers have been notified.

17 15

stateEuropean courtMonetary inUnion Kansas– City, Missouri, against Intertek Testing Services Limited seeking damages from improper testing and analysis. On January 12, 2000, a third complaint was filed in state court in Los Angeles, California, against Intertek Testing Services Limited and Intertek Testing Services Environmental Laboratories, Inc. seeking damages arising for improper testing and analysis and alleging fraud.Euro

On ~~September 21~~January 1, ~~2000~~1999, ~~the US Department~~ eleven of ~~Justice~~the ~~announced~~European ~~that~~Union amember ~~federal grand jury in Dallas~~states, ~~Texas~~including ~~returned~~seven ancountries ~~indictment~~in ofwhich ~~thirty~~we ~~counts against~~operate, ~~thirteen~~established ~~persons~~fixed ~~who~~conversion ~~were~~rates ~~formerly~~between ~~employed~~their atexisting ~~Intertek~~currencies ~~Testing~~and ~~Services Environmental~~adopted ~~Laboratories~~one ~~Inc~~common ~~in Richardson~~currency, ~~Texas. Charges against~~ the ~~thirteen~~Euro. ~~persons include~~The ~~conspiracy~~conversion to ~~commit~~the ~~mail~~Euro ~~fraud,~~eliminates ~~conspiracy to present false, fictitious~~currency ~~and~~exchange ~~fraudulent~~rate ~~claims~~risk ~~against~~among the ~~United~~eleven ~~States~~member ~~and wire fraud~~countries. ~~The trial date has been provisionally set for February 5, 2001. To date, no criminal charges have been filed against ITS Environmental.~~

~~All~~ ~~these~~The ~~cases~~currencies ~~are~~of in the ~~preliminary stages and we are unable to predict~~ ~~the~~eleven ~~outcome~~member ofstates ~~these~~remain ~~actions.~~legal Wetender ~~are~~in ~~unable to estimate~~ the ~~cost~~participating ofcountries ~~any civil~~during ora ~~criminal~~three-year ~~penalties~~transition ~~arising~~period from ~~this investigation. However~~January 1, on1999 ~~the~~through ~~basis~~January 1, 2002. ofEffective ~~currently~~January 1, ~~available information~~1999, ~~we consider that~~ the ~~outcome~~Euro is ~~unlikely to~~traded ~~have a material adverse effect~~ on ~~our~~currency ~~business~~exchanges and ~~our~~is ~~financial position.~~available Wefor ~~have~~non-cash ~~notified~~transactions ~~Inchcape~~during ~~plc of~~ the ~~investigation~~three-year ~~and~~transitional ~~are~~period. ~~pursuing possible~~Beginning ~~rights~~on ofJanuary 1, ~~recovery~~2002, ~~against~~the ~~Inchcape~~European ~~plc~~Central ~~under~~Bank ~~the~~will ~~Share~~issue ~~Purchase~~Euro-denominated ~~Deed. Our group~~bills ~~professional~~and ~~indemnity~~coins ~~insurance~~for ~~policy~~use ~~may~~in ~~respond~~cash attransactions. ~~least~~On toor ~~legal~~before ~~costs~~July 1, ~~civil~~ ~~damages~~2002, ~~and~~the ~~third~~participating countries ~~party~~will ~~claims.~~withdraw ~~With~~all ~~our~~bills ~~broker,~~and wecoins ~~are~~and ~~seeking~~use ~~acceptance of~~ the ~~loss~~Euro byas ~~the~~their ~~insurer~~legal currency.

~~Caleb~~ ~~Brett~~Our ~~USA~~operating units affected by the Euro have established plans to address the issues raised by the conversion. These issues, ~~Inc~~among –others, ~~Puerto~~include ~~Rico~~such matters as pricing, continuity of contracts, accounting and financial reporting, taxation, treasury activities and computer systems. A number of our operating units in France and Portugal have converted their systems and began reporting in Euros during Q1 00. The remaining operating units will convert their local records to the Euro during 2001.

~~Caleb~~ ~~Brett~~Although ~~USA,~~we ~~Inc~~have ~~has~~not ~~been informed that an investigation is underway by~~identified ~~the~~any ~~U.S.~~immediate ~~Department of Justice Environmental Crime Section of certain practices at its Puerto Rico facility. The investigation~~problems, ~~which relates to events in 1997 and prior, is at a preliminary stage and~~ we ~~are~~cannot ~~unable~~be tocertain ~~predict the outcome or estimate the cost of any civil or criminal penalties~~ that ~~may arise. However, on~~ the ~~basis~~harmonisation of ~~currently available information, we consider that the outcome~~currencies isin ~~unlikely~~Europe towill not have a material adverse ~~effect~~impact on ~~our~~the ~~business~~operating ~~and our financial~~results, financial position. Weor ~~have~~liquidity ~~notified Inchcape plc~~ of ~~the investigation and are pursuing possible rights of recovery against Inchcape plc under the Share Purchase Deed. This event may give rise to a claim under~~ our ~~group~~European ~~professional indemnity insurance policy and our brokers have been notified~~businesses.

~~Euro~~ 16

OnIntertek JanuaryTesting 1,Services 1999,Limited elevenConsolidated Statements of the European Union member states, including seven countries in which we operate, established fixed conversion rates between their existing currencies and adopted one common currency, the Euro. The conversion to the Euro eliminates currency exchange rate risk among the eleven member countries.Operations

The currencies of the eleven member states remain legal tender in the participating countries during a three-year transition period from January 1, 1999 through January 1, 2002. Effective January 1, 1999, the Euro is traded on currency exchanges and is available for non-cash transactions during the three-year transitional period. Beginning on January 1, 2002, the European Central Bank will issue Euro-denominated bills and coins for use in cash transactions. On or before July 1, 2002, the participating countries will withdraw all bills and coins and use the Euro as their legal currency.

	Unaudited

	Three months to March 31, 2000 £m	Three months to March 31, 2001 £m

Revenues
Continuing operations	88.1	104.1
Discontinued operations	0.7	—

Group revenues	88.8	104.1
Operating costs	(81.3)	(91.3)

Group operating income	7.5	12.8
Share of operating profit in associates	0.2	0.3

Total operating income	7.7	13.1


Operating income/(loss) before exceptional items
Continuing operations	11.0	13.1
Discontinued operations	(0.7)	—

	10.3	13.1
Exceptional items charged to operating income
Continuing operations	(1.6)	—
Discontinued operations	(1.0)	—

Total operating income	7.7	13.1


Operating income/(loss) after exceptional items
Continuing operations	9.4	13.1
Discontinued operations	(1.7)	—

Total operating income	7.7	13.1


Non operating exceptional items
Continuing operations	(3.0)	—
Discontinued operations	(12.1)	—

Total non-operating exceptional items	(15.1)	—


(Loss)/income on ordinary activities before net interest	(7.4)	13.1
Net interest expense	(8.1)	(9.3)

(Loss)/income before taxation	(15.5)	3.8
Taxation	(1.8)	(2.6)

(Loss)/income after taxation	(17.3)	1.2
Minority interests	(0.6)	(0.8)

Net (loss)/income for the group and its share of associates	(17.9)	0.4

~~Our~~ ~~operating~~The ~~units affected by the Euro have established plans to address~~accompanying ~~the~~notes ~~issues~~on ~~raised~~pages byF ~~the~~- ~~conversion.~~5 ~~These~~to ~~issues,~~F ~~among~~- ~~others,~~20 ~~include~~are ~~such matters~~an asintegral ~~pricing,~~part ~~continuity~~ of ~~contracts,~~these ~~accounting and~~ financial ~~reporting, taxation, treasury activities and computer systems~~statements. A number of our operating units in France and Portugal have converted their systems and began reporting in Euros during Q1 00. We anticipate that the remaining operating units will convert their local records to the Euro during the three-year transition period.

~~Although~~F-1 we have not identified any immediate problems, we cannot be certain that the harmonisation of currencies in Europe will not have a material adverse impact on the operating results, financial position or liquidity of our European businesses.

18Intertek Testing Services Limited Consolidated Balance Sheets

Intertek Testing Services Limited Consolidated Statements of Operations

			Unaudited

	Notes	December 31, 2000 £m	March 31, 2001 £m

ASSETS
Current assets
Cash	7	21.3	19.3
Trade receivables		81.6	83.5
Inventories		1.7	1.8
Other current assets		19.1	21.6

Total current assets		123.7	126.2
Goodwill		16.8	16.8
Property, plant and equipment, net		67.9	70.4
Investments		0.9	1.3

Total assets		209.3	214.7


LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities
Borrowings (including current portion of long term borrowings)	3	22.1	25.0
Accounts payable, accrued liabilities and deferred income		80.5	80.7
Income taxes payable		6.9	6.0

Total current liabilities		109.5	111.7
Long term borrowings	3	300.3	310.6
Provisions for liabilities and charges		13.9	12.5
Minority interests		6.3	6.5

Shareholders’ deficit
Ordinary shares		0.8	0.8
Redeemable preference shares		105.5	105.5
Shares to be issued		2.8	2.8
Premium in excess of par value		3.6	3.6
Accumulated deficit		(333.4)	(339.3)

Total shareholders’ deficit		(220.7)	(226.6)

Total liabilities and shareholders’ deficit		209.3	214.7

		(Unaudited)
	Note	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
Revenues
Continuing operations		261.0		291.2
Discontinued operations		8.5		0.7
Group revenues		269.5		291.9
Operating costs		(228.2	)	(245.7	)
Group operating income		41.3		46.2
Share of operating profit in associates		0.2		0.6
Total operating income		41.5		46.8
Operating income/(loss) before exceptional items
Continuing operations		35.3		43.3
Discontinued operations		(1.8	)	(0.7	)
		33.5		42.6
Exceptional items credited/(charged) to operating income
Continuing operations		10.9		7.2
Discontinued operations		(2.9	)	(3.0	)
Total operating income		41.5		46.8
Operating income/(loss) after exceptional items
Continuing operations		46.2		50.5
Discontinued operations		(4.7	)	(3.7	)
Total operating income		41.5		46.8
Non-operating exceptional items
Continuing operations		2.5		(3.0	)
Discontinued operations		—		(12.2	)
Total non-operating exceptional items		2.5		(15.2	)
Income on ordinary activities before net interest		44.0		31.6
Net interest expense		(24.3	)	(26.4	)
Income before taxation		19.7		5.2
Taxation	3	(5.4	)	(7.6	)
Income/(loss) after taxation		14.3		(2.4	)
Minority interests		(2.4	)	(2.4	)
Net income/(loss) for the group and its share of associates		11.9		(4.8	)

The accompanying notes on pages F - 5 to F - 20 are an integral part of these financial statements.

~~The accompanying notes on pages~~ F-62 ~~to F-27 are an integral part of these financial statements.~~

F-1Intertek Testing Services Limited Consolidated Statements of Cash Flows

Intertek Testing Services Limited Consolidated Statements of Operations

		Unaudited

	Notes	Three months to March 31, 2000 £m	Three months to March 31, 2001 £m

Total operating cash inflow	5	8.0	7.1
Returns on investments and servicing of finance	6	(2.7)	(2.0)
Taxation		(2.2)	(3.4)
Capital expenditure and financial investment	6	(3.1)	(5.2)
Acquisitions and disposals	6	0.5	(0.5)


Cash inflow/(outflow) before financing		0.5	(4.0)

Financing	6	(4.3)	2.0


Decrease in cash in the period		(3.8)	(2.0)


Reconciliation of net cash flow to movement in net debt	7

Decrease in cash in the period		(3.8)	(2.0)

Cash inflow/(outflow) from increase in debt		4.3	(2.0)

Change in net debt resulting from cash flows		0.5	(4.0)
Debt issued in lieu of interest payment		(2.3)	(2.8)
Acquisitions and disposals		(0.7)	—
Other non-cash movements		(0.5)	(0.5)
Exchange adjustments		(3.0)	(7.9)


Movement in net debt in the period		(6.0)	(15.2)
Net debt at the start of the period		(273.5)	(301.1)


Net debt at the end of the period		(279.5)	(316.3)

	(Unaudited)
	Three months to September 30, 1999 £m		Three months to September 30, 2000 £m
Revenues
Continuing operations	87.9		102.4
Discontinued operations	2.9		—
Group revenues	90.8		102.4
Operating costs	(80.5	)	(79.4	)
Group operating income	10.3		23.0
Share of operating profit in associates	—		0.1
Total operating income	10.3		23.1
Operating income/(loss) before exceptional items
Continuing operations	10.6		15.7
Discontinued operations	(0.6	)	—
	10.0		15.7
Exceptional items credited/(charged) to operating income
Continuing operations	3.2		8.4
Discontinued operations	(2.9	)	(1.0	)
Total operating income	10.3		23.1
Operating income/(loss) after exceptional items
Continuing operations	13.8		24.1
Discontinued operations	(3.5	)	(1.0	)
Total operating income	10.3		23.1
Non-operating exceptional items
Continuing operations	0.1		—
Discontinued operations	—		0.1
Total non-operating exceptional items	0.1		0.1
Income on ordinary activities before net interest	10.4		23.2
Net interest expense	(8.0	)	(9.3	)
Income before taxation	2.4		13.9
Taxation	(0.1	)	(2.0	)
Income after taxation	2.3		11.9
Minority interests	(0.9	)	(1.0	)
Net income for the group and its share of associates	1.4		10.9

The accompanying notes on pages F - 5 to F - 20 are an integral part of these financial statements.

~~The accompanying notes on pages~~ F-~~6 to F-27 are an integral part of these financial statements.~~3

F-2Intertek Testing Services Limited

IntertekConsolidated TestingStatements Servicesof LimitedTotal ConsolidatedRecognised BalanceGains Sheetsand Losses

				(Unaudited)
	Unaudited
		Notes		December 31, 1999 £m		September 30, 2000 £m
	Three months to March 31, 2000 £m		Three months to March 31, 2001 £m
ASSETS
Net (loss)/income from subsidiaries	(18.0)		0.2
Current assets
Net income from associates	0.1		0.2
Cash		8		20.2		33.6
	(17.9)		0.4
Trade receivables				70.1		77.8
Exchange adjustments	(3.0)		(6.3)
Inventories				2.6		1.8
Total recognised gains and losses	(20.9)		(5.9)
Other current assets				15.6		20.0
Total current assets				108.5		133.2
Goodwill				15.8		16.2
Property, plant and equipment, net				53.8		59.5
Investments				0.5		1.2
Total assets				178.6		210.1
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities
Borrowings (including current portion of long term borrowings)		4		15.4		22.2
Accounts payable, accrued liabilities and deferred income				69.5		82.2
Income taxes payable				5.4		6.3
Total current liabilities				90.3		110.7
Long term borrowings		4		278.2		305.4
Provisions for liabilities and charges				6.8		7.0
Minority interests				5.8		5.7
Shareholders’ deficit
Ordinary shares				0.8		0.8
Redeemable preference shares				105.5		105.5
Shares to be issued				2.8		2.8
Premium in excess of par value				3.6		3.6
Accumulated deficit				(315.2	)	(331.4	)
Total shareholders’ deficit				(202.5	)	(218.7	)
Total liabilities and shareholders’ deficit				178.6		210.1

~~The~~ ~~accompanying~~There ~~notes~~is onno ~~pages~~material ~~F-6~~difference between toincome ~~F-27~~before ~~are~~taxation, anand ~~integral~~net income for the financial periods, as ~~part~~stated in the statements of ~~these~~operations ~~financial~~and ~~statements~~their historical cost equivalents.

F-3Consolidated Statements of Changes in Shareholders’ Deficit

Intertek Testing Services Limited Consolidated Statements of Cash Flows

	Unaudited

	Ordinary shares £m	Redeemable preference shares £m	Shares to be issued £m	Premium in excess of par value £m	Accumulated deficit £m	Total £m


Balance at January 1, 2000	0.8	105.5	2.8	3.6	(315.2)	(202.5)
Net loss	—	—	—	—	(17.9)	(17.9)
Goodwill adjustments	—	—	—	—	10.1	10.1
Exchange adjustments	—	—	—	—	(3.0)	(3.0)

Balance at March 31, 2000	0.8	105.5	2.8	3.6	(326.0)	(213.3)


Balance at January 1, 2001	0.8	105.5	2.8	3.6	(333.4)	(220.7)
Net income	—	—	—	—	0.4	0.4
Exchange adjustments	—	—	—	—	(6.3)	(6.3)

Balance at March 31, 2001	0.8	105.5	2.8	3.6	(339.3)	(226.6)

		(Unaudited)
	Notes	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
Total operating cash inflow	6	45.1		51.1
Returns on investments and servicing of finance	7	(13.0	)	(15.8	)
Taxation		(4.5	)	(7.3	)
Capital expenditure and financial investment	7	(9.1	)	(14.1	)
Acquisitions and disposals	7	(2.8	)	0.1
Cash inflow before financing		15.7		14.0
Financing	7	(4.4	)	(0.9	)
Increase in cash in the period		11.3		13.1
Reconciliation of net cash flow to movement in net debt	8
Increase in cash in the period		11.3		13.1
Cash inflow from movement in debt		24.8		1.0
Change in net debt resulting from cash flows		36.1		14.1
Debt issued in lieu of interest payment		(6.0	)	(7.2	)
Acquisitions and disposals		(1.6	)	(0.8	)
Other non-cash movements		(1.5	)	(1.6	)
Exchange adjustments		(5.2	)	(25.1	)
Decrease/(increase) in net debt in the period		21.8		(20.6	)
Net debt at the start of the period		(279.0	)	(273.4	)
Net debt at the end of the period		(257.2	)	(294.0	)

Included in accumulated deficit is £294.3 million relating to goodwill (at March 31, 2000: £270.2 million). This comprises goodwill of £291.7 written off to reserves in relation to the acquisition of subsidiaries prior to December 1997 (at March 31, 2000: £268.8 million) and £2.6 million amortised goodwill in relation to acquisitions from January 1, 1998 (at March 31, 2000: £1.4 million).

The accompanying notes on pages F -6 5 to F -27 20 are an integral part of these financial statements.

F-4

Intertek Testing Services Limited Consolidated Statements of Total Recognised Gains and Losses

	(Unaudited)
	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
Net income/(loss) from subsidiaries	12.2		(4.6	)
Net loss from associates	(0.3	)	(0.2	)
	11.9		(4.8	)
Exchange adjustments	(5.6	)	(21.4	)
Total recognised gains and losses	6.3		(26.2	)

There is no material difference between income before taxation, and net income for the financial periods, as stated in the statements of operations and their historical cost equivalents.

Consolidated Statements of Changes in Shareholders’ Deficit

	(Unaudited)
	Ordinary shares £m	Redeemable preferences shares £m	Shares to be issued £m	Premium in excess of par value £m	Accumulated deficit £m		Total £m
Balance at January 1, 1999	0.3	86.7	2.8	3.0	(314.2	)	(221.4	)
Net income	—	—	—	—	11.9		11.9
Issue of shares	0.5	18.8	—	0.6	—		19.9
Exchange adjustments	—	—	—	—	(5.6	)	(5.6	)
Balance at September 30, 1999	0.8	105.5	2.8	3.6	(307.9	)	(195.2	)
Balance at January 1, 2000	0.8	105.5	2.8	3.6	(315.2	)	(202.5	)
Net loss	—	—	—	—	(4.8	)	(4.8	)
Goodwill adjustments	—	—	—	—	10.0		10.0
Exchange adjustments	—	—	—	—	(21.4	)	(21.4	)
Balance at September 30, 2000	0.8	105.5	2.8	3.6	(331.4	)	(218.7	)

Included in accumulated deficit is £289.8 million relating to goodwill (at September 30, 1999: £273.6 million). This comprises goodwill of £287.8 million written off to reserves in relation to the acquisition of subsidiaries prior to December 1997 (at September 30, 1999: £272.6 million) and £2.0 million amortised goodwill in relation to acquisitions from January 1, 1998 (at September 30, 1999: £1.0 million).

The accompanying notes on pages F-6 to F-27 are an integral part of these financial statements.

F-5

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

1. Basis of presentation

The accompanying consolidated financial statements of the Company and its subsidiaries at ~~September~~March 3031, ~~2000,~~2001 ~~for the nine months to September 30, 2000~~ and for the three months to ~~September~~March 3031, ~~2000~~2001 are unaudited. In the opinion of the ~~Directors,~~ Directors, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the financial statements have been included. The ~~results~~ results of these periods are not necessarily indicative of results for the entire ~~year~~ year and have been prepared in conformity with accounting principles generally ~~accepted~~ accepted in the United Kingdom (“U.K. GAAP”) and are presented under the historical cost convention. These principles differ in certain material respects from generally accepted accounting principles in the United States (“U.S. GAAP”) – see note 98.

For the purpose of these condensed consolidated financial statements, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United Kingdom have been condensed or omitted. These unaudited statements should be read in conjunction with the audited financial statements and notes as of and for the year ended December 31, ~~1999~~2000.

2. Accounting policies

The significant accounting policies adopted by the Company and its subsidiaries are set out below.

Basis of consolidation

The consolidated financial statements of the Company include the financial statements of the Company and its subsidiaries. The acquisition method of accounting has been adopted. Under this method, the results of subsidiaries acquired or sold are included in the consolidated statement of income of the Company from, or up to, the date control passes. The consolidated statements of income of the Company include their respective shares of income from associated undertakings. The consolidated balance sheets of the Company includes interests in associates at their respective shares of the net tangible assets.

The acquisition method of accounting has been adopted. Under this method, the results of subsidiaries acquired or sold are included in the consolidated statement of income of the Company from, or up to, the date control passes.

The consolidated statements of income of the Company include their respective shares of income from associated undertakings. The consolidated balance sheets of the Company includes interests in associates at their respective shares of the net tangible assets.

Use of estimates

Preparation of financial statements in conformity with U.K. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for an accounting period. Such estimates and assumptions could change in the future as more information becomes known or circumstances alter, such that the group’s actual results may differ from the amounts reported and disclosed in the financial statements.

Foreign currencies

The results of operations and cash flows of overseas subsidiaries and associated undertakings are translated into sterling at the average of the month end rates of exchange for the period. Assets and liabilities in foreign currencies are translated into sterling at closing rates of exchange except where rates are fixed under contractual arrangements. The difference between net income/(loss) translated at average and at closing rates of exchange is included in the statement of total recognised gains and losses as a movement in shareholders’ equity/(deficit). Exchange differences arising from the retranslation to closing rates of exchange of opening shareholders’ equity, long-term foreign currency borrowings used to finance foreign currency investments, and foreign currency borrowings that provide a hedge against shareholders’ equity are also reflected as movements in shareholders’ equity/(deficit). All other exchange differences are dealt with in operations.

The difference between net income/(loss) translated at average and at closing rates of exchange is included in the statement of total recognised gains and losses as a movement in shareholders’ equity/(deficit). Exchange differences arising from the retranslation to closing rates of exchange of opening shareholders’ equity, longF-term foreign currency borrowings used to finance foreign currency investments, and foreign currency borrowings that provide a hedge against shareholders’ equity are also reflected as movements in shareholders’ equity/(deficit). All other exchange differences are dealt with in operations.5

F-6

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Accounting policies (continued)

Property, plant and equipment and depreciation

Property, plant and equipment are stated at cost less depreciation, which is provided, except for freehold land, on a straight line basis over the estimated useful lives of the assets, mainly at the following annual rates:

Freehold buildings and long leasehold land and buildings	2%
Short leasehold land and buildings	term of lease
Plant, machinery and equipment	10% -– 33.3%

Leases

Assets held under capital leases are treated as if they had been purchased at the present value of the minimum lease payments. This cost is included in property, plant and equipment, and depreciation is provided over the shorter of the lease term or the estimated useful life. The corresponding obligations under these leases are included within borrowings. The finance charge element of rentals payable is charged to operations to produce a constant rate of interest. Operating lease rentals are charged to operations on a straight-line basis over the periods of the leases.

Inventories

Inventories are stated at the lower of cost orand net realisable value. Cost comprises expenditure incurred in the normal course of business in bringing inventories and work in progress to their present location and condition.

Revenues

Revenues represent the total amount receivable for services provided and goods sold, excluding sales-related taxes and intra-group transactions. Revenue is recognised when the relevant service is completed or goods delivered.

Taxation

Deferred taxation is provided using the liability method at current taxation rates on timing differences to the extent that the directors consider that it is probable that a liability or asset will crystallise.

Pension benefits

Liabilities under defined contribution pension schemes are charged to operations when incurred. ITS has a number of defined benefit pension schemes for which contributions are based on triennial actuarial valuations. Pension charges in operations have been calculated at a substantially level percentage of current and expected future pensionable payroll, with variations from regular cost spread over the expected remaining service lives of employees.

Goodwill and other intangible assets

Purchased goodwill in respect of acquisitions since January 1, 1998 is capitalised in accordance with the requirements of FRS 10: Goodwill and Intangible Assets, and is amortised on a straight line ~~bases~~basis over its estimated useful life, which is is up to 20 years. Other intangible assets, such as non compete covenants, are amortised over the term of the agreement, generally between two to five years. Purchased goodwill in respect of acquisitions before January 1, 1998 was ~~written~~ written off to reserves in the year of acquisition in accordance with the accounting standard then in force. When a subsequent disposal occurs any goodwill previously written off to reserves is written back through the profit and loss account.

DerivativeCash financialand instrumentscash equivalents

~~ITS~~ ~~uses~~Cash ~~various~~for ~~derivative~~the ~~financial~~purposes of ~~instruments~~the tocash ~~manage~~flow ~~its~~statement, ~~exposure~~comprise ~~to foreign~~cash ~~exchange~~in hand and ~~interest~~deposits ~~rate~~repayable ~~risks. Derivative financial instruments are~~on ~~considered~~demand, ~~hedges~~less ifoverdrafts ~~they~~payable ~~meet~~on ~~certain criteria~~demand. ~~A forward exchange contract is~~

F-76

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Accounting policies (continued)

Derivative financial instruments (continued)

ITS uses various derivative financial instruments to manage its exposure to foreign exchange and interest rate risks. Derivative financial instruments are considered hedges if they meet certain criteria. A forward exchange contract is considered a hedge of an identifiable foreign currency commitment if such contract is designated as, and is effective as, a hedge of a firm foreign currency commitment. An interest rate swap agreement is considered a “synthetic alteration” (and accounted for like a hedge) when the agreement is designated with a specific liability and it alters the interest rate characteristics of such liability. An Interest rate cap agreement must also meet the same criteria as an interest rate swap to be considered ~~hedges~~ hedge of a specific liability. Derivative financial instruments failing to meet the aforementioned criteria are accounted for at fair value with the resulting unrealised gains and losses included in the statement of operations.

Forward exchange contracts. Forward exchange contracts are designated as hedges of firm foreign currency commitments. Gains and losses on such contracts are deferred and recognised in income or as an adjustment of the carrying amount when the hedged transaction occurs.

Interest rate cap agreements. Interest rate cap agreements are accounted for under the accruals basis. Amounts receivable under the agreement are accrued when due as a reduction of interest charges. Premiums paid for purchased interest rate cap agreements are amortised to interest charges over the term of the caps.

Interest rate swaps. Interest rate swap agreements are designated to change the interest rate characteristics of floating-rate borrowings. Accordingly, these agreements are accounted for under the settlement basis. The interest differential between the amounts received and amount paid is recognised as an adjustment to interest charges over the term of the swap.

3. TaxationBorrowings

The taxation charges on income before taxation and exceptional items for the nine month periods ended September 30, 1999 and September 30, 2000 have been calculated based on the estimated effective tax rates for the relevant full years. Exceptional items have been tax effected as appropriate.

	December 31, 2000 £m	March 31, 2001 £m


Due in less than one year:
Senior Term Loan A	12.1	13.0
Senior Revolver	10.0	12.0

	22.1	25.0


Due in more than one year:
Senior Term Loan A	46.0	47.1
Senior Term Loan B	34.7	34.7
Senior Subordinated Notes	133.5	137.3
Parent Subordinated PIK Debentures	86.1	91.5

	300.3	310.6

~~4. Borrowings~~F-7

	December 31, 1999 £m	September 30, 2000 £m
Due in less than one year:
Senior Term Loan A	4.7	8.7
Senior Revolver	10.4	13.4
Other borrowings	0.3	0.1
	15.4	22.2
Due in more than one year:
Senior Subordinated Notes	120.9	133.9
Senior Term Loan A	54.7	52.8
Senior Term Loan B	33.7	34.9
Parent Subordinated PIK Debentures	68.6	83.7
Other borrowings	0.3	0.1
	278.2	305.4

F-8

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Borrowings (continued)

Maturity of borrowings:

	Senior Subordinated Notes		Senior Term Loan A		Senior Term Loan B		Senior Revolver	Parent Subordinated PIK Debentures		Other borrowings	Total borrowings
	Senior Term Loan A £m		Senior Term Loan B £m		Senior Revolver £m		Senior Subordinated Notes £m	Parent Subordinated PIK Debentures £m		Total borrowings £m
	£m		£m		£m		£m	£m		£m	£m
Due in less than 1 year	13.1		—		12.0		—	—		25.1
Due in less than one year	—		9.4		—		13.4	—		0.1	22.9
Due in 1 to 2 years	15.7		—		—		—	—		15.7
Due in one to two years	—		37.8		—		—	—		0.1	37.9
Due in 2 and 5 years	32.6		35.5		—		—	—		68.1
Due in 2 and 5 years	—		16.0		35.8		—	—		—	51.8
Due in over 5 years	—		—		—		142.0	92.9		234.9
Due in over 5 years	139.0		—		—		—	85.1		—	224.1
	61.4		35.5		12.0		142.0	92.9		343.8
	139.0		63.2		35.8		13.4	85.1		0.2	336.7
Debt issuance costs	(1.3)		(0.8)		—		(4.7)	(1.4)		(8.2)
Debt issuance costs	(5.1	)	(1.7	)	(0.9	)	—	(1.4	)	—	(9.1	)
	60.1		34.7		12.0		137.3	91.5		335.6
	133.9		61.5		34.9		13.4	83.7		0.2	327.6

54. Reconciliation of movement in shareholders’ deficit

	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
	Three months to March 31, 2000 £m		Three months to March 31, 2001 £m
Total recognised gains and losses for the period	6(20.39)		(265.29)	)
Issue of ordinary share capital	1.1		—
Goodwill adjustments	10.1		—
Issue of redeemable preference shares	18.8		—
	(10.8)		(5.9)
Goodwill adjustments	—		10.0
Opening shareholders’ deficit	(202.5)		(220.7)
	26.2		(16.2	)
Closing shareholders’ deficit	(213.3)		(226.6)
Opening shareholders’ deficit	(221.4	)	(202.5	)
Closing shareholders’ deficit	(195.2	)	(218.7	)

F-98

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

65. Reconciliation of operating income to operating cash flows

	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
	Three months to March 31, 2000 £m		Three months to March 31, 2001 £m
Operating income	417.57		4613.81
Depreciation charge	83.40		93.48
Goodwill amortisation	0.62		0.83
Loss on sale of fixed assets	0.12		~~0.2~~—
Decrease/(increase) in inventories	0.1		(0.2	)
Increase in receivables and prepayments	(3.4)		(3.5)
Increase in receivables and prepayments	(4.8	)	(10.9	)
Increase/(decrease) in payables	0.4		(4.8)
(Decrease)/increase in payables	(4.6	)	4.9
Discontinued operating exceptional provisions – Environmental	1.0		—
Cash receipts from exporters	5.4		—
Decrease in other provisions	(0.9)		(1.5)
Discontinued operating exceptional provisions - Environmental	2.9		3.0
	8.2		7.4
Decrease in other provisions	(4.7	)	(2.7	)
Equity income of associates	(0.2)		(0.3)
	44.9		51.3
Total operating cash inflow	8.0		7.1
Equity income of associates	(0.2	)	(0.6	)
Less dividends received from associates	0.4		0.4
Total operating cash inflow	45.1		51.1

76. Analysis of cash flows

	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
	Three months to March 31, 2000 £m		Three months to March 31, 2001 £m
Returns on investment and servicing of finance
Net interest paid	(112.40)	)	(131.04)	)
Dividends paid to minorities	(10.67)	)	(20.86)	)
	(13.0	)	(15.8	)
	(2.7)		(2.0)
Capital expenditure and financial investment
Purchase of property, plant and equipment	(9.3.2)	)	(145.3)	)
Sale of property, plant and equipment	0.21		0.21
	(9.1	)	(14.1	)
	(3.1)		(5.2)
Acquisitions and disposals
Purchase of subsidiary undertakings	(60.54)	)	~~(1.4~~—	)
Sale of subsidiary undertakings	30.79		~~1.6~~—
Acquisition provision payments	—		(0.15)	)
	(2.8	)	0.1
	0.5		(0.5)
Financing
(Repayment)/issue of short term debt	(16.3	)	2.9
Repayment of short term debt	(3.9)		—
Repayment of other loans	(80.54)	)	~~(3.9~~—	)
Issue of ordinary shares	1.1		—
Issue of debt	—		2.0
Issue of redeemable preference share	18.8		—
	(4.3)		2.0
Cash subscribed by minorities	0.5		0.1
	(4.4	)	(0.9	)

F-109

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

87. Analysis of net debt

	At December 31, 1999 £m		Cash flow £m	Acquisitions and disposals £m		Debt issued in lieu of interest payment £m		Other non- cash changes £m		Exchange adjustments £m		At September 30, 2000 £m
	At December 31, 2000 £m		Cash flow £m	Debt issued in lieu of interest payment £m		Other non- cash changes £m		Exchange adjustments £m		At March 31, 2001 £m
Net cash
Cash in hand and at bank	2021.23		13(2.10)	~~(0.8~~—	)	—		—		119.13		~~33.6~~
Debt
Debt due within one year	(1522.41)	)	1(2.0)	—		—		(60.9)	)	(025.90)	)	~~(22.2~~	)
Debt due after one year	(~~278~~300.23)	)	—	—(2.8)		(70.25)	)	5(7.30)		(25310.36)	)	~~(305.4~~	)
	(293.6	)	1.0	—		(7.2	)	(1.6	)	(26.2	)	(327.6	)
	(322.4)		(2.0)	(2.8)		(0.5)		(7.9)		(335.6)
Total net debt	(~~273~~301.41)	)	14(4.10)	(02.8)	)	(70.25)	)	(17.69)	)	(25316.13)	)	~~(294.0~~	)

98. Summary of differences between U.K. and U.S. GAAP

The consolidated financial statements are prepared in conformity with U.K. GAAP. These accounting principles differ in certain material respects from U.S. GAAP. Described below are the material differences between U.K. GAAP and U.S. GAAP ~~GAAP~~ affecting the net income/(loss) and shareholders’ equity/(deficit) which are set forth in the tables that follow.

Goodwill and other intangible assets

Under U.K. GAAP, purchased goodwill in respect of acquisitions before January 1, 1998 was written off to reserves in the year of acquisition. Purchased goodwill in respect of acquisitions since January 1, 1998 is capitalised in accordance with the requirements of FRS 10, Goodwill and Intangible Assets. Other intangible assets, such as non compete covenants, are amortised over the term of the agreement, generally between two to five years. Positive goodwill is amortised to nil in equal instalments over its estimated useful life, generally not exceeding 20 years. Under U.S. GAAP, goodwill and identifiable intangibles are capitalised and are written off over their estimated useful lives, generally not exceeding 40 years. U.S. GAAP goodwill and identifiable intangibles are being written off over periods not exceeding 20 years.

Redeemable preference shares

Under U.K. GAAP, preference shares with mandatory redemption features or that are redeemable at the option of the security holders ~~would~~are be classified as a component of shareholders’ equity. U.S. GAAP requires such redeemable preference shares to be classified outside asof ~~debt~~shareholders’ ~~and~~equity. ~~not~~Additionally, asunder ~~shareholders’~~U.S. GAAP, ~~equity~~the initial carrying amount of redeemable preferred stock is equal to its fair value at date of issuance. When the fair value of mandatorily redeemable preferred stock at the time of its issuance is less than the mandatory redemption amount, the carrying amount is increased by periodic accretion, using the interest method, such that the carrying amount will equate mandatory redemption amount at the mandatory redemption date.

Disposal of business segment

Under U.K. GAAP, the profit or loss arising on the disposal of a business segment after the year end, but before the earlier of three months and the date when the financial statements are approved, is not recognised in the financial statements but is disclosed as a post balance sheet event and the disposed business segment is classified as a discontinued operation in the financial statements. U.S. GAAP requires that if a loss is expected from such disposal, such loss be recognised in the not yet released financial statements.

F-10

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Summary of differences between U.K. and U.S. GAAP (continued)

Pension costs — defined benefit plans

Under U.K. GAAP, the cost of providing pension benefits is expensed over the average expected service lives of eligible employees on the basis of a constant percentage of current and estimated future earnings. Under U.S. GAAP, costs and surpluses are similarly spread over the remaining service lives but based on prescribed actuarial assumptions, cost allocation and valuation methods which differ in certain respects from those used for U.K. GAAP.

As a result of this difference in methodology, the U.S. GAAP pension expense can be significantly different from that determined under U.K. GAAP and tends to be more sensitive to changing economic conditions.

F-11

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Summary of differences between U.K. and U.S. GAAP (continued)

Compensated absences

Under U.S. GAAP, compensated absences, being an employee’s paid holiday entitlements, are accrued as earned. U.K. GAAP does not require provision to be made.

Derivative instruments and hedging activities

Under U.K. GAAP, forward exchange contracts are designed as hedges of firm foreign currency commitments. Gains and losses on such contracts are deferred and recognised in income or as an adjustment of the carrying amount when the hedged transaction occurs. Interest rate swap agreements are designed to change the interest rate characteristics of floating rate borrowings. Accordingly, these agreements are accounted for under the settlement basis. The interest differential between the amounts received and amount paid is recognised as an adjustment to interest charges over the term of the swap.

Under U.S. GAAP, Statement of Financial Accounting Standards (‘SFAS’) No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS No. 138 Accounting for Certain Derivative Instruments and Certain Hedging Activities – An Amendment to SFAS No. 133, requires that an entity recognises all derivatives in the consolidated balance sheet at fair value. The accounting for changes in the fair value of a derivative depends on the use of the derivative. Derivatives that are not designated as part of a hedging relationship must be adjusted to fair value through income. Changes in the fair value of derivatives designated as fair value hedges are recorded in income as well as the gain or loss on the hedged asset or liability. Changes in the fair value of derivatives designated as cash flow hedges are classified as other comprehensive income until the hedged item is recognised in income. The ineffective portions of derivatives that are hedges are immediately recognised in income.

Deferred taxation

Under U.K. GAAP, deferred taxation is accounted for using the liability method to the extent that it is considered probable that a liability or asset will crystallise in the foreseeable future. Under U.S. GAAP, deferred taxation is provided on all temporary differences and carryforwards. Deferred tax assets are recognised to the extent that it is more likely than not that they will be realised. Where doubt exists as to whether a deferred tax asset will be realised, an appropriate valuation allowance is established. In addition, deferred taxes on other U.S. GAAP differences is provided.

F-11

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Summary of differences between U.K. and U.S. GAAP (continued)

Effect of material differences between U.K. and U.S. GAAP and additional disclosures

(a) Net income/(loss)

	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
	Three months to March 31, 2000 £m		Three months to March 31, 2001 £m
Net income/(loss) reported under U.K. GAAP	11.9		(4.8	)
Net (loss)/income reported under U.K. GAAP	(17.9)		0.4
Goodwill amortisation	(81.85)	)	(73.20)	)
Covenants not to compete amortisation	(9.6	)	—
Previously recognised loss on disposal and closure of discontinued operation	11.6		—
Loss on disposal and closure of discontinued operation	—		—
Compensated absences	0.2		(0.1)
Previously recognised loss on disposal and closure of discontinued operation	—		11.6
Deferred taxes	—		—
Pensions	(0.2	)	—
Derivative instruments and hedging	—		(0.6)
Compensated absences	(0.1	)	0.2
Net loss in conformity with U.S. GAAP	(7.6)		(3.3)
Deferred taxes	—		—
Continuing operations	(5.5)		(3.3)
Tax effect of U.S. GAAP reconciling adjustments	—		—
Discontinued operations	(2.1)		—
Net loss in conformity with U.S. GAAP	(67.86)	)	(03.23)	)
Continuing operations	(1.9	)	15.7
Discontinued operations	(4.9	)	(15.9	)
Net loss in conformity with U.S. GAAP	(6.8	)	(0.2	)

(b) Shareholders’ deficit

The approximate effects on shareholders’ deficit of material differences between U.K. and U.S. GAAP are as follows:

	December 31, 2000 £m	March 31, 2001 £m


Shareholders’ deficit reported under U.K. GAAP	(220.7)	(226.6)
Goodwill	188.2	189.5
Redeemable preference shares	(30.0)	(31.1)
Pensions	0.3	0.3
Compensated absences	(0.6)	(0.8)
Derivative instruments and hedging activities	—	(0.6)

Shareholders’ deficit in conformity with U.S. GAAP	(62.8)	(69.3)

F-12

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Summary of differences between U.K. and U.S. GAAP (continued)

(b) Shareholders’ deficit

The approximate effects on shareholders’ deficit of material differences between U.K. and U.S. GAAP are as follows:

	December 31, 1999 £m		September 30, 2000 £m
Shareholders’ deficit reported under U.K. GAAP	(202.5	)	(218.7	)
Goodwill	190.0		193.3
Covenants not to compete	—		—
Redeemable preference shares	(105.5	)	(105.5	)
Previously recognised loss on disposal and closure of discontinued operation	(5.0	)	—
Pensions	1.0		1.0
Compensated absences	(0.7	)	(0.5	)
Shareholders’ deficit in conformity with U.S. GAAP	(122.7	)	(130.4	)

The following table reconciles shareholders’ deficit under U.S. GAAP:

Shareholders’ deficit at beginning of period	(94.3	)	(122.7	)
	December 31, 2000 £m		March 31, 2001 £m
Issue of shares	1.1		—
Shareholders’ deficit at beginning of period	(43.3)		(62.8)
Net loss for the period	(24.0	)	(0.2	)
Accretion of discount on redeemable preference shares	(3.9)		(1.1)
Exchange adjustments	(5.5	)	(7.5	)
Net loss for the period	(6.0)		(3.3)
Shareholders’ deficit at end of period	(122.7	)	(130.4	)
Exchange adjustments	(9.6)		(2.1)
Shareholders’ deficit at end of period	(62.8)		(69.3)

(c) Cash flows

The statements of cash flows prepared in accordance with U.K. GAAP present substantially the same information as that required under U.S. GAAP. Under U.S. GAAP however, there are certain differences from U.K. GAAP with regard to classification of items within the cash flow statement and with regard to the definition of cash.

Under U.K. GAAP, cash flows are presented separately for operating activities, returns on investments and servicing of finance, taxation, capital expenditure and financial investment, acquisitions and disposals, equity dividends paid, management of liquid resources and financing. Under U.S. GAAP, three categories of cash flow activity are reported, those being operating activities, investing activities and financing activities. Cash flows from taxation and returns on investments and servicing of finance would, with the exception of dividends paid, be included as operating activities under U.S. GAAP. Capital expenditure and financial investment, acquisitions and disposals and management of liquid resources would be included as investing activities. The payment of dividends would be included under financing activities under U.S. GAAP.

Set out below is a summary of the statements of cash flows under U.S. GAAP.

	Three months to March 31, 2000 £m	Three months to March 31, 2001 £m


Net cash provided by operating activities	1.9	2.3
Net cash used in investing activities	(4.2)	(5.7)
Net cash (used in)/provided by financing activities	(0.1)	1.4

Net decrease in cash by continuing operations	(2.4)	(2.0)


Decrease in cash by continuing operations	(2.4)	(2.0)
Decrease in cash by discontinued operations	(2.2)	—
Cash at beginning of period	20.2	21.3

Cash at end of period	15.6	19.3

F-13

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Summary of differences between U.K. and U.S. GAAP (continued)

Set out below is a summary of the statements of cash flows under U.S. GAAP.

	Nine months to September 30, 1999 £m		Nine months to September 30, 2000 £m
Net cash provided by operating activities	30.4		25.6
Net cash used in investing activities	(13.4	)	(10.6	)
Net cash used in financing activities	(4.8	)	(6.1	)
	12.2		8.9
Effect of exchange rate changes	—		1.1
Net increase in cash by continuing operations	12.2		10.0
Increase in cash by continuing operations	12.2		10.0
(Decrease)/increase in cash by discontinued operations	(2.6	)	3.4
Cash at beginning of period	16.8		20.2
Cash at end of period	26.4		33.6

(d) Comprehensive income

The company has adopted SFAS No. 130, “Reporting Comprehensive Income”, which established standards for the reporting and presentation of comprehensive income/(loss) and its components in a full set of financial statements. The Company’s comprehensive income/(loss) differs from net income only by the amount of the foreign currency exchange adjustments charged to shareholders’ deficit ~~deficit~~ for the period~~. Comprehensive income for the nine months to September 30~~, ~~1999 and~~ the ~~nine~~periodic ~~months~~accretion toof ~~September 30, 2000 is equal to~~ the ~~total~~redeemable ~~recognised gains~~preference ~~and~~stock ~~losses shown on the consolidated statement of total recognised gains~~ and ~~losses. Accumulated other comprehensive losses were £8.2 million and~~ ~~£34.9~~the ~~million~~transitional atadjustment ~~September~~for ~~30,~~derivative ~~1999~~instruments and ~~September~~hedging ~~30, 2000, respectively~~activities.

The following table reconciles accumulated other comprehensive loss under U.S. GAAP:

	Three months to March 31, 2000 £m	Three months to March 31, 2001 £m


Other comprehensive loss at the beginning of period	(26.4)	(51.5)
Exchange adjustments	(3.0)	(6.3)
Redeemable preference share accretion	(0.9)	(1.1)
Derivative instruments and hedging activities	—	(0.4)

Other comprehensive loss at the end of period*	(30.3)	(59.3)

*Other comprehensive income and the carrying value of the preference shares as of March 31, 2000 have been reduced by £13.7 million from amounts previously shown as of March 31, 2000 in order to reflect the carrying value of such shares as of that date at their initial carrying value plus cumulative accretion from date of original issue.

F-14

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

109. Issuer, guarantor and non-guarantor companies

Intertek Finance plc (“the Issuer”) is a wholly owned direct subsidiary of the Company and the Issuer has issued the Notes which are fully and unconditionally guaranteed on a senior subordinated basis by the Company and certain of its wholly owned direct subsidiaries: Intertek Testing Services UKU.K. Limited, Testing Holdings USA Inc., Yickson Enterprises Limited, Kite Overseas Holdings BV, ITS Holding Limited, Testing Holdings Sweden AB, Testing Holdings France EURL, Testing Holdings Germany GmbH (collectively, the “Guarantor subsidiaries” ~~and, together with the Company, the “Guarantors”~~). In addition, each of the Guarantor’s guarantee is itself guaranteed by each other Guarantor, fully and unconditionally, on a senior subordinated basis. Subject to the provisions of the agreement under which the loans to finance the acquisition of the business were made, certain exceptions and applicable law, there are no restrictions on the ability of:

(a)	the Company or any of its direct and indirect subsidiaries from paying dividends or making any other distributions or loans or advances to the Issuer or
(b)	the direct and indirect subsidiaries of the Company from paying dividends or making any other distribution or loans or advances to the Company.

Separate financial statements and other disclosures concerning the Issuer, the Company and the ~~Guarantors~~Guarantor subsidiaries are not presented because management has determined that they are not material to the investors. In lieu of the separate guarantor financial statements, management has presented ~~audited~~condensed consolidating financial information. The ~~audited~~condensed consolidating financial information presented below has been segregated between (a) the Issuer, (b) the ~~Guarantors~~Company, (c) the Guarantor subsidiaries and (cd) the non-Guarantor subsidiaries.

F-15

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Operations ~~Nine~~Three months to ~~September~~March 3031, ~~2000~~2001

	Intertek Finance plc £m	~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m		~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
Total group revenue	—	—		~~322.9~~—		~~(31~~115.07	)	~~291~~(11.96)		104.1
Operating costs	—	(0.5	)	(276.3	)	31.0		(245.8	)
Operating income/(costs)	—	0.1		—		(103.0)		11.6		(91.3)
Share of operating profit in associates	—	—		~~0.6~~—		—0.3		~~0.6~~—		0.3
Operating (loss)/income	—	(0.5	)	47.2		—		46.7
Operating income	—	0.1		—		13.0		—		13.1
Non-operating exceptional items	—	(70.46)	)	~~(7.7~~—	)	—0.6		~~(15.1~~—	)	—
(Loss)/income before interest	—	(7.9	)	39.5		—		31.6
Income/(loss) before interest	—	(0.5)		—		13.6		—		13.1
Net interest expense	~~0.1~~—	(122.34)	)	(~~14.~~2.0)	)	—(4.9)		~~(26.4~~—	)	(9.3)
Income/(loss) before taxation	~~0.1~~—	(~~20.~~2.9)	)	25(2.30)		—8.7		~~5.2~~—		3.8
Taxation	—	~~0.5~~—		(80.13	)	—(2.9)		~~(7.6~~—	)	(2.6)
Income/(loss) after taxation	~~0.1~~—	(192.79)	)	17(1.27)		—5.8		~~(2.4~~—	)	1.2
Minority interests	—	—		~~(2.4~~—	)	—(0.8)		~~(2.4~~—	)	(0.8)
Dividends from/(to) group companies	—	~~0.9~~—		(0.94	)	—(0.4)		—		—
Net income/(loss)	~~0.1~~—	(182.89)	)	13(1.93)		—4.6		~~(4.8~~—	)	0.4

Statements of Operations Three months to ~~September~~March 3031, 2000

	Intertek Finance plc £m		~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m		~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
Total group revenue	—		—		~~113.9~~—		~~(11~~98.52	)	~~102~~(9.4)		88.8
Operating costs	—		(0.3	)	(90.6	)	11.5		(79.4	)
Operating income/(costs)	0.1		(0.1)		—		(90.7)		9.4		(81.3)
Share of operating profit in associates	—		—		~~0.1~~—		—0.2		~~0.1~~—		0.2
Operating (loss)/income	—		(0.3	)	23.4		—		23.1
Operating income/(loss)	0.1		(0.1)		—		7.7		—		7.7
Non-operating exceptional items	—		(10.18)	)	1(4.23)		—(10.0)		~~0.1~~—		(15.1)
(Loss)/income before interest	—		(1.4	)	24.6		—		23.2
Income before interest	0.1		(0.9)		(4.3)		(2.3)		—		(7.4)
Net interest expense	~~(0.4~~—	)	(41.39)	)	(41.69)	)	—(4.3)		~~(9.3~~—	)	(8.1)
Income/(loss) before taxation	(0.41	)	(52.78)	)	20(6.02)		—(6.6)		~~13.9~~—		(15.5)
Taxation	—		~~0.3~~—		~~(2.3~~—	)	—(1.8)		~~(2.0~~—	)	(1.8)
Income/(loss) after taxation	(0.41	)	(52.48)	)	17(6.72)		—(8.4)		~~11.9~~—		(17.3)
Minority interests	—		—		~~(1.0~~—	)	—(0.6)		~~(1.0~~—	)	(0.6)
Dividends from/(to) group companies	—		—		—0.6		—(0.6)		—		—
Net (loss)/income	(0.4	)	(5.4	)	16.7		—		10.9
Net income/(loss)	0.1		(2.8)		(5.6)		(9.6)		—		(17.9)

F-16

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

~~Statements~~Balance ~~of Operations~~Sheets ~~Nine~~March ~~months to September 30~~31, ~~1999~~2001

	Intertek Finance plc £m	~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m		~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
Total group revenue	—	—		309.1		(39.6	)	269.5
ASSETS
Operating income/(costs)	0.1	0.1		(268.0	)	39.6		(228.2	)
Current assets
Share of operating profit in associates	—	—		0.2		—		0.2
Cash	—	(9.6)		0.6		28.3		—		19.3
Operating income	0.1	0.1		41.3		—		41.5
Trade receivables	—	—		—		83.5		—		83.5
Non-operating exceptional items	—	(1.2	)	3.7		—		2.5
Inventories	—	—		—		1.8		—		1.8
Income/(loss) before interest	0.1	(1.1	)	45.0		—		44.0
Other current assets	153.7	98.9		228.4		327.5		(786.9)		21.6
Net interest expense	—	(10.8	)	(13.5	)	—		(24.3	)
Total current assets	153.7	89.3		229.0		441.1		(786.9)		126.2
Income/(loss) before taxation	0.1	(11.9	)	31.5		—		19.7
Goodwill	—	—		—		16.8		—		16.8
Taxation	—	1.0		(6.4	)	—		(5.4	)
Property, plant and equipment, net	—	—		—		70.4		—		70.4
Income/(loss) after taxation	0.1	(10.9	)	25.1		—		14.3
Investments in subsidiary undertakings	—	128.6		222.2		74.3		(425.1)		—
Minority interests	—	—		(2.4	)	—		(2.4	)
Investments	—	—		—		1.3		—		1.3
Dividends from/(to) group companies	—	0.5		(0.5	)	—		—
Total assets	153.7	217.9		451.2		603.9		(1,212.0)		214.7
Net income/(loss)	0.1	(10.4	)	22.2		—		11.9
LIABILITIES AND SHAREHOLDERS’ EQUITY/(DEFICIT)
Current liabilities
Borrowings (including current portion of long term borrowings)	—	12.0		13.1		(0.1)		—		25.0
Accounts payable, accrued liabilities and deferred income	15.0	46.7		233.8		572.1		(786.9)		80.7
Income taxes payable	—	(0.4)		(2.4)		8.8		—		6.0
Total current liabilities	15.0	58.3		244.5		580.8		(786.9)		111.7
Long term borrowings	138.3	91.5		82.5		(1.7)		—		310.6
Provisions for liabilities and charges	—	—		—		12.5		—		12.5
Minority interests	—	—		—		6.5		—		6.5
Shareholders’ equity/(deficit)
Ordinary shares	0.1	0.8		118.2		192.8		(311.1)		0.8
Redeemable preference shares	—	105.5		—		—		—		105.5
Shares to be issued	—	2.8		—		—		—		2.8
Premium in excess of par value	—	3.6		26.5		—		(26.5)		3.6
Accumulated earnings/(deficit)	0.3	(44.6)		(20.5)		(187.0)		(87.5)		(339.3)
Total shareholders’ equity/(deficit)	0.4	68.1		124.2		5.8		(425.1)		(226.6)
Total liabilities and shareholders’ equity/(deficit)	153.7	217.9		451.2		603.9		(1,212.0)		214.7

Statements of Operations Three months to September 30, 1999

	Intertek Finance plc £m	Guarantors £m		Non- Guarantor subsidiaries £m		Consolidation adjustments £m		Consolidated totals £m
Total group revenue	—	—		100.9		(10.1	)	90.8
Operating costs	—	—		(90.6	)	10.1		(80.5	)
Share of operating profit in associates	—	—		—		—		—
Operating income	—	—		10.3		—		10.3
Non-operating exceptional items	—	(0.2	)	0.3		—		0.1
(Loss)/income before interest	—	(0.2	)	10.6		—		10.4
Net interest expense	—	(3.4	)	(4.6	)	—		(8.0	)
(Loss)/income before taxation	—	(3.6	)	6.0		—		2.4
Taxation	—	0.2		(0.3	)	—		(0.1	)
(Loss)/income after taxation	—	(3.4	)	5.7		—		2.3
Minority interests	—	—		(0.9	)	—		(0.9	)
Dividends from/(to) group companies	—	—		—		—		—
Net (loss)/income	—	(3.4	)	4.8		—		1.4

F-17

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Balance Sheets ~~September~~December 3031, 2000

	Intertek Finance plc £m	~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m		~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
ASSETS
Current assets
Cash	—	(311.82)	)	370.47		—31.8		~~33.6~~—		21.3
Trade receivables	—	—		~~77.8~~—		—81.6		~~77.8~~—		81.6
Inventories	—	—		~~1.8~~—		—1.7		~~1.8~~—		1.7
Other current assets	~~148~~145.08	~~317~~92.59		~~315~~218.26		~~(760~~294.79	)	20(733.01)		19.1
Total current assets	~~148~~145.08	~~313~~81.7		~~432~~219.23		~~(760~~410.70	)	~~133~~(733.21)		123.7
Goodwill	—	—		~~16.2~~—		—16.8		~~16.2~~—		16.8
Property, plant and equipment, net	—	—		~~59.5~~—		—67.9		~~59.5~~—		67.9
Investments in subsidiary undertakings	—	~~347~~128.56		61217.08		~~(408~~74.5	)	—(420.9)		—
Investments	—	—		~~1.2~~—		—0.9		~~1.2~~—		0.9
Total assets	~~148~~145.08	~~661~~210.23		~~570~~437.1		~~(1,169~~570.21	)	~~210.~~(1,154.0)		209.3
LIABILITIES AND SHAREHOLDERS’ EQUITY/(DEFICIT)
Current liabilities
Borrowings (including current portion of long term borrowings)	—	2210.40		(012.20	)	—0.1		~~22.2~~—		22.1
Accounts payable, accrued liabilities and deferred
Accounts payable, accrued liabilities and deferred income	11.0	42.7		223.2		536.7		(733.1)		80.5
income	12.6	271.6		558.7		(760.7	)	82.2
Income taxes payable	—	(0.4)		(2.3)		9.6		—		6.9
Income taxes payable/(receivable)	—	(2.1	)	8.4		—		6.3
Total current liabilities	11.0	52.3		232.9		546.4		(733.1)		109.5
Total current liabilities	12.6	291.9		566.9		(760.7	)	110.7
Long term borrowings	134.4	86.1		81.4		(1.6)		—		300.3
Long term borrowings	135.1	171.8		(1.5	)	—		305.4
Provisions for liabilities and charges	—	—		—		13.9		—		13.9
Provisions for liabilities and charges	—	—		7.0		—		7.0
Minority interests	—	—		—		6.3		—		6.3
Minority interests	—	—		5.7		—		5.7
Shareholders’ equity/(deficit)
Shareholders’ equity/(deficit)
Ordinary shares	0.1	0.8		115.1		195.9		(311.1)		0.8
Ordinary shares	—	116.9		195.0		(311.1	)	0.8
Redeemable preference shares	—	105.5		—		—		—		105.5
Redeemable preference shares	—	105.5		—		—		105.5
Shares to be issued	—	2.8		—		—		—		2.8
Shares to be issued	—	2.8		—		—		2.8
Premium in excess of par value	—	3.6		25.8		0.6		(26.4)		3.6
Premium in excess of par value	—	29.5		0.5		(26.4	)	3.6
Accumulated earnings/(deficit)	0.3	(40.8)		(18.1)		(191.4)		(83.4)		(333.4)
Accumulated earnings/(deficit)	0.3	(57.2	)	(203.5	)	(71.0	)	(331.4	)
Total shareholders’ equity/(deficit)	0.4	71.9		122.8		5.1		(420.9)		(220.7)
Total shareholders’ equity/(deficit)	0.3	197.5		(8.0	)	(408.5	)	(218.7	)
Total liabilities and shareholders’ equity/(deficit)	145.8	210.3		437.1		570.1		(1,154.0)		209.3
Total liabilities and shareholders’ equity/(deficit)	148.0	661.2		570.1		(1,169.2	)	210.1

F-18

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

~~Balance~~Statements ~~Sheets~~of Cash Flows ~~December~~Three months to March 31, ~~1999~~2001

	Intertek Finance plc £m	~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m		~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
ASSETS
Total operating cash inflow	—	0.5		0.3		6.3		—		7.1
Current assets
Returns on investments and servicing of finance	—	(0.3)		1.1		(2.8)		—		(2.0)
Cash	—	(6.7	)	26.9		—		20.2
Taxation	—	—		(0.1)		(3.3)		—		(3.4)
Trade receivables	—	—		70.1		—		70.1
Capital expenditure and financial investment	—	—		—		(5.2)		—		(5.2)
Inventories	—	—		2.6		—		2.6
Acquisitions and disposals	—	—		—		(0.5)		—		(0.5)
Other current assets	130.3	280.4		256.5		(651.6	)	15.6
Cash inflow/(outflow) before financing	—	0.2		1.3		(5.5)		—		(4.0)
Deferred taxation asset	—	—		—		—		—
Financing	—	1.4		(1.3)		1.9		—		2.0
Total current assets	130.3	273.7		356.1		(651.6	)	108.5
Increase/(decrease) in cash in the period	—	1.6		—		(3.6)		—		(2.0)
Goodwill	—	—		15.8		—		15.8
Reconciliation of net cash flow to movements in net debt
Property, plant and equipment, net	—	—		53.8		—		53.8
Increase/(decrease) in cash in the period	—	1.6		—		(3.6)		—		(2.0)
Investments in subsidiary undertakings	—	335.2		74.4		(409.6	)	—
Cash outflow from increase in debt	—	(2.0)		—		—		—		(2.0)
Investments	—	—		0.5		—		0.5
Change in net debt resulting from cash flows	—	(0.4)		—		(3.6)		—		(4.0)
Total assets	130.3	608.9		500.6		(1,061.2	)	178.6
Debt issued in lieu of interest payment	—	(2.8)		—		—		—		(2.8)
LIABILITIES AND SHAREHOLDERS’ EQUITY/(DEFICIT)
Other non-cash movements	(0.2)	—		(0.1)		(0.2)		—		(0.5)
Current liabilities
Exchange adjustments	(3.7)	(2.6)		(2.2)		0.6		—		(7.9)
Borrowings (including current portion of long term borrowings)	—	15.5		(0.1	)	—		15.4
Movement in net debt in the period	(3.9)	(5.8)		(2.3)		(3.2)		—		(15.2)
Accounts payable, accrued liabilities and deferred income	8.0	229.2		483.9		(651.6	)	69.5
Net debt at the start of the period	(134.4)	(107.3)		(92.7)		33.3		—		(301.1)
Income taxes payable/(receivable)	—	(2.5	)	7.9		—		5.4
Net debt at the end of the period	(138.3)	(113.1)		(95.0)		30.1		—		(316.3)
Total current liabilities	8.0	242.2		491.7		(651.6	)	90.3
Long term borrowings	122.1	157.7		(1.6	)	—		278.2
Provisions for liabilities and charges	—	—		6.8		—		6.8
Minority interests	—	—		5.8		—		5.8
Shareholders’ equity/(deficit)
Ordinary shares	—	106.6		205.1		(310.9	)	0.8
Redeemable preference shares	—	105.5		—		—		105.5
Shares to be issued	—	2.8		—		—		2.8
Premium in excess of par value	—	27.2		2.9		(26.5	)	3.6
Accumulated earnings/(deficit)	0.2	(33.1	)	(210.1	)	(72.2	)	(315.2	)
Total shareholders’ equity/(deficit)	0.2	209.0		(2.1	)	(409.6	)	(202.5	)
Total liabilities and shareholders’ equity/(deficit)	130.3	608.9		500.6		(1,061.2	)	178.6

F-19

Intertek Testing Services Limited
Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Cash Flows ~~Nine~~Three months to ~~September~~March 3031, 2000

	Intertek Finance plc £m		~~Guarantors~~Intertek Testing Services Ltd £m		~~Non-~~ Guarantor subsidiaries £m		~~Consolidation~~Non- ~~adjustments~~Guarantor subsidiaries £m	~~Consolidated~~Consolidation ~~totals~~adjustments £m		Consolidated totals £m
Total operating cash inflow	—		—		51.1		—	51.1
Total operating cash inflow/(outflow)	0.1		(0.5)		(0.1)		8.5	—		8.0
Returns on investments and servicing of finance	(04.23	)	~~(2.~~0.1	)	(133.60)	)	—(4.1)	~~(15.8~~—	)	(2.7)
Taxation	—		~~1.2~~—		(80.51)	)	—(2.1)	~~(7.3~~—	)	(2.2)
Capital expenditure and financial investment	—		—		~~(14.1~~—	)	—(3.1)	~~(14.1~~—	)	(3.1)
Acquisitions and disposals	—		(1.83)	)	1(0.97)		—2.5	~~0.1~~—		0.5
Cash (outflow)/inflow before financing	(0.2	)	(2.6	)	16.8		—	14.0
Cash inflow/(outflow) before financing	4.4		(1.7)		(3.9)		1.7	—		0.5
Financing	0(4.24)		53.5		(64.61	)	—(7.5)	~~(0.9~~—	)	(4.3)
Increase in cash in the period	—		2.9		10.2		—	13.1
Increase/(decrease) in cash in the period	—		1.8		0.2		(5.8)	—		(3.8)
Reconciliation of net cash flow to movement in net debt
Increase in cash in the period	—		2.9		10.2		—	13.1
Increase/(decrease) in cash in the period	—		1.8		0.2		(5.8)	—		(3.8)
Cash inflow from increase in debt	—		0.5		0.5		—	1.0
Cash inflow/(outflow) from increase in debt	—		3.9		0.5		(0.1)	—		4.3
Change in net debt resulting from cash flows	—		35.47		100.7		—(5.9)	~~14.1~~—		0.5
Debt issued in lieu of interest payment	—		(7.2.3)	)	—		—	~~(7.2~~—	)	(2.3)
Acquisitions and disposals	—		—		~~(0.8~~—	)	—(0.7)	~~(0.8~~—	)	(0.7)
Other non-cash movements	(0.51)	)	~~(0.5~~—	)	(0.62)	)	—(0.2)	~~(1.6~~—	)	(0.5)
Exchange adjustments	(121.56)	)	(130.89)	)	1(0.25)		—	~~(25.1~~—	)	(3.0)
Movement in net debt in the period	(131.07)	)	~~(18~~2.15	)	~~10.5~~—		—(6.8)	~~(20.6~~—	)	(6.0)
Net debt at the start of the period	(122.1)	)	(~~180~~86.05)	)	28(93.75)		—28.6	~~(273.4~~—	)	(273.5)
Net debt at the end of the period	(~~135~~123.18)	)	(~~198~~84.10)	)	39(93.25)		—21.8	~~(294.0~~—	)	(279.5)

F-20

~~Intertek~~ ~~Testing Services Limited Notes To The Consolidated Financial Statements~~SIGNATURE

~~Issuer~~ Pursuant to the requirements of the Securities Exchange Act of 1934, ~~guarantor~~the ~~and~~Registrant ~~non~~certifies that it meets all of the requirements for filing on Form 6-~~guarantor~~K ~~companies~~and ~~(continued)~~has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.

~~Statements~~ ofINTERTEK ~~Cash~~TESTING ~~Flows~~SERVICES ~~Nine months to September 30, 1999~~LIMITED (Registrant)

	Intertek Finance plc £m		Guarantors £m		Non- Guarantor subsidiaries £m		Consolidation adjustments £m	Consolidated totals £m
By:	/s/ WILLIAM SPENCER
Total operating cash (outflow)/inflow	(0.1	)	(1.1	)	46.3		—	45.1
	Name:	William Spencer
Returns on investments and servicing of finance	2.2		(0.1	)	(15.1	)	—	(13.0	)
	Title:	Director
Taxation	—		(0.1	)	(4.4	)	—	(4.5	)
	Date:	May 14, 2001
Capital expenditure and financial investment	—		—		(9.1	)	—	(9.1	)
Acquisitions and disposals	—		(1.4	)	(1.4	)	—	(2.8	)
Cash inflow/(outflow) before financing	2.1		(2.7	)	16.3		—	15.7
Financing	(2.1	)	8.7		(11.0	)	—	(4.4	)
Increase in cash in the period	—		6.0		5.3		—	11.3
Reconciliation of net cash flow to movement in net debt
Increase in cash in the period	—		6.0		5.3		—	11.3
Cash inflow from increase in debt	—		22.9		1.9		—	24.8
Change in net debt resulting from cash flows	—		28.9		7.2		—	36.1
Debt issued in lieu of interest payment	—		(6.0	)	—		—	(6.0	)
Acquisitions and disposals	—		—		(1.6	)	—	(1.6	)
Other non-cash movements	(0.4	)	0.2		(1.3	)	—	(1.5	)
Exchange adjustments	(2.9	)	(2.4	)	0.1		—	(5.2	)
Movement in net debt in the period	(3.3	)	20.7		4.4		—	21.8
Net debt at the start of the period	(116.3	)	(187.0	)	24.3		—	(279.0	)
Net debt at the end of the period	(119.6	)	(166.3	)	28.7		—	(257.2	)

F-21

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Operations Nine months to September 30, 2000

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m		Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m		Testing Holdings France EURL £m		Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Revenues from continuing operations	—		—		—		—		—		—		—		—		—		—
Operating costs	(0.5	)	—		—		—		—		—		—		—		—		(0.5	)
Operating costs from continuing operations	(0.5	)	—		—		—		—		—		—		—		—		(0.5	)
Non-operating exceptional items	(3.0	)	(4.4	)	—		—		—		—		—		—		—		(7.4	)
Loss before interest	(3.5	)	(4.4	)	—		—		—		—		—		—		—		(7.9	)
Net interest expense	(6.3	)	(1.1	)	(0.3	)	(0.1	)	(2.5	)	(1.5	)	(0.1	)	(0.1	)	(0.3	)	(12.3	)
Loss before taxation	(9.8	)	(5.5	)	(0.3	)	(0.1	)	(2.5	)	(1.5	)	(0.1	)	(0.1	)	(0.3	)	(20.2	)
Taxation	—		(0.1	)	—		—		0.7		—		—		(0.1	)	—		0.5
Loss after taxation	(9.8	)	(5.6	)	(0.3	)	(0.1	)	(1.8	)	(1.5	)	(0.1	)	(0.2	)	(0.3	)	(19.7	)
Dividends from group companies	—		0.6		0.3		—		—		—		—		—		—		0.9
Net loss	(9.8	)	(5.0	)	—		(0.1	)	(1.8	)	(1.5	)	(0.1	)	(0.2	)	(0.3	)	(18.8	)

Statements of Operations Three months to September 30, 2000

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m	Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m	Testing Holdings France EURL £m	Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Revenues from continuing operations	—		—		—		—	—		—		—	—	—		—
Operating costs	(0.3	)	—		—		—	—		—		—	—	—		(0.3	)
Operating costs from continuing operations	(0.3	)	—		—		—	—		—		—	—	—		(0.3	)
Non-operating exceptional items	(1.0	)	(0.1	)	—		—	—		—		—	—	—		(1.1	)
Loss before interest	(1.3	)	(0.1	)	—		—	—		—		—	—	—		(1.4	)
Net interest expense	(2.3	)	(0.4	)	(0.1	)	—	(0.9	)	(0.5	)	—	—	(0.1	)	(4.3	)
Loss before taxation	(3.6	)	(0.5	)	(0.1	)	—	(0.9	)	(0.5	)	—	—	(0.1	)	(5.7	)
Taxation	—		—		—		—	0.3		—		—	—	—		0.3
Loss after taxation	(3.6	)	(0.5	)	(0.1	)	—	(0.6	)	(0.5	)	—	—	(0.1	)	(5.4	)
Dividends from group companies	—		—		—		—	—		—		—	—	—		—
Net loss	(3.6	)	(0.5	)	(0.1	)	—	(0.6	)	(0.5	)	—	—	(0.1	)	(5.4	)

F-22

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Operations Nine months to September 30, 1999

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m	Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m		Testing Holdings France EURL £m		Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Revenues from continuing operations	—		—		—		—	—		—		—		—		—		—
Operating income	0.1		—		—		—	—		—		—		—		—		0.1
Operating income from continuing operations	0.1		—		—		—	—		—		—		—		—		0.1
Non-operating exceptional items	(1.2	)	—		—		—	—		—		—		—		—		(1.2	)
Loss before interest	(1.1	)	—		—		—	—		—		—		—		—		(1.1	)
Net interest expense	(5.5	)	(0.5	)	(0.2	)	—	(2.5	)	(1.6	)	(0.1	)	(0.1	)	(0.3	)	(10.8	)
(Loss)/income before taxation	(6.6	)	(0.5	)	(0.2	)	—	(2.5	)	(1.6	)	(0.1	)	(0.1	)	(0.3	)	(11.9	)
Taxation	—		0.3		—		—	0.7		—		—		—		—		1.0
(Loss)/income after taxation	(6.6	)	(0.2	)	(0.2	)	—	(1.8	)	(1.6	)	(0.1	)	(0.1	)	(0.3	)	(10.9	)
Dividends from group companies	—		0.5		—		—	—		—		—		—		—		0.5
Net (loss)/income	(6.6	)	0.3		(0.2	)	—	(1.8	)	(1.6	)	(0.1	)	(0.1	)	(0.3	)	(10.4	)

Statements of Operations Three months to September 30, 1999

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m	Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m	Testing Holdings France EURL £m	Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Revenues from continuing operations	—		—		—		—	—		—		—	—	—		—
Operating income	—		—		—		—	—		—		—	—	—		—
Operating income from continuing operations	—		—		—		—	—		—		—	—	—		—
Non-operating exceptional items	(0.2	)	—		—		—	—		—		—	—	—		(0.2	)
(Loss)/income before interest	(0.2	)	—		—		—	—		—		—	—	—		(0.2	)
Net interest expense	(1.6	)	(0.3	)	(0.1	)	—	(0.8	)	(0.5	)	—	—	(0.1	)	(3.4	)
Loss before taxation	(1.8	)	(0.3	)	(0.1	)	—	(0.8	)	(0.5	)	—	—	(0.1	)	(3.6	)
Taxation	—		—		—		—	0.2		—		—	—	—		0.2
Loss after taxation	(1.8	)	(0.3	)	(0.1	)	—	(0.6	)	(0.5	)	—	—	(0.1	)	(3.4	)
Dividends from group companies	—		—		—		—	—		—		—	—	—		—
Net loss	(1.8	)	(0.3	)	(0.1	)	—	(0.6	)	(0.5	)	—	—	(0.1	)	(3.4	)

F-23

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Balance Sheets September 30, 2000

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m		Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m	Yickson Enterprises Limited £m		Testing Holdings France EURL £m		Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
ASSETS
Current assets
Cash	(4.8	)	—		—		1.0		—		—	—		—		—		(3.8	)
Other current assets	92.9		111.8		2.4		4.4		—		2.0	103.1		0.5		0.4		317.5
Total current assets	88.1		111.8		2.4		5.4		—		2.0	103.1		0.5		0.4		313.7
Investments in subsidiary undertakings	128.6		106.2		5.1		4.2		71.0		23.6	—		3.3		5.5		347.5
Total assets	216.7		218.0		7.5		9.6		71.0		25.6	103.1		3.8		5.9		661.2
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Borrowings (including current portion of
long term borrowings)	13.4		—		0.4		0.6		2.5		0.7	4.8		—		—		22.4
Accounts payable, accrued liabilities and
deferred income	45.1		117.4		4.0		2.8		23.2		3.1	72.2		2.9		0.9		271.6
Income taxes (receivable)/payable	—		(0.9	)	—		—		(0.8	)	—	—		(0.2	)	(0.2	)	(2.1	)
Total current liabilities	58.5		116.5		4.4		3.4		24.9		3.8	77.0		2.7		0.7		291.9
Long term borrowings	83.8		—		2.5		2.6		32.7		19.1	26.6		—		4.5		171.8
Shareholders’ equity
Ordinary shares	0.8		106.9		1.3		4.2		—		1.8	—		0.8		1.1		116.9
Redeemable preference shares	105.5		—		—		—		—		—	—		—		—		105.5
Shares to be issued	2.8		—		—		—		—		—	—		—		—		2.8
Premium in excess of par value	3.6		—		—		—		25.1		—	—		—		0.8		29.5
Accumulated (deficit)/earnings	(38.3	)	(5.4	)	(0.7	)	(0.6	)	(11.7	)	0.9	(0.5	)	0.3		(1.2	)	(57.2	)
Total shareholders’ equity/(deficit)	74.4		101.5		0.6		3.6		13.4		2.7	(0.5	)	1.1		0.7		197.5
Total liabilities and shareholders’ equity	216.7		218.0		7.5		9.6		71.0		25.6	103.1		3.8		5.9		661.2

F-24

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Balance Sheets December 31, 1999

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m		Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m	Yickson Enterprises Limited £m		Testing Holdings France EURL £m	Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
ASSETS
Current assets
Cash	(7.5	)	—		—		0.8		—		—	—		—	—		(6.7	)
Other current assets	82.6		99.3		2.1		4.0		—		2.0	89.4		1.0	—		280.4
Total current assets	75.1		99.3		2.1		4.8		—		2.0	89.4		1.0	—		273.7
Investments in subsidiary undertakings	128.6		99.8		5.4		3.8		64.4		24.1	—		3.4	5.7		335.2
Total assets	203.7		199.1		7.5		8.6		64.4		26.1	89.4		4.4	5.7		608.9
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Borrowings (including current portion of
long term borrowings)	10.4		—		0.2		0.5		1.2		0.4	2.8		—	—		15.5
Accounts payable, accrued liabilities and
deferred income	37.1		103.3		3.7		2.0		18.7		1.6	59.5		2.8	0.5		229.2
Income taxes (receivable)/payable	(0.7	)	(0.8	)	—		—		(1.0	)	—	—		0.2	(0.2	)	(2.5	)
Total current liabilities	46.8		102.5		3.9		2.5		18.9		2.0	62.3		3.0	0.3		242.2
Long term borrowings	68.6		—		2.9		2.7		31.7		20.0	27.2		—	4.6		157.7
Shareholders’ equity
Ordinary shares	0.8		96.9		1.3		3.8		—		1.8	—		0.9	1.1		106.6
Redeemable preference shares	105.5		—		—		—		—		—	—		—	—		105.5
Shares to be issued	2.8		—		—		—		—		—	—		—	—		2.8
Premium in excess of par value	3.6		—		—		—		22.7		—	—		—	0.9		27.2
Accumulated (deficit)/earnings	(24.4	)	(0.3	)	(0.6	)	(0.4	)	(8.9	)	2.3	(0.1	)	0.5	(1.2	)	(33.1	)
Total shareholders’ equity/(deficit)	88.3		96.6		0.7		3.4		13.8		4.1	(0.1	)	1.4	0.8		209.0
Total liabilities and shareholders’ equity	203.7		199.1		7.5		8.6		64.4		26.1	89.4		4.4	5.7		608.9

F-25

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Cash Flows Nine months to September 30, 2000

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m		Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m		Testing Holdings France EURL £m		Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Total operating cash inflow/(outflow)	0.4		—		—		—		—		—		—		—		(0.4	)	—
Returns on investments and servicing of finance	0.2		—		—		—		(2.0	)	(0.8	)	0.8		—		(0.2	)	(2.0	)
Taxation	0.7		(0.1	)	—		—		1.0		—		—		(0.4	)	—		1.2
Acquisitions and disposals	(1.2	)	(0.5	)	—		—		—		—		—		(0.1	)	—		(1.8	)
Cash inflow/(outflow) before financing	0.1		(0.6	)	—		—		(1.0	)	(0.8	)	0.8		(0.5	)	(0.6	)	(2.6	)
Financing	2.5		0.6		—		0.2		1.0		0.9		(0.8	)	0.5		0.6		5.5
Increase in cash in the period	2.6		—		—		0.2		—		0.1		—		—		—		2.9
Reconciliation of net cash flow to movement in net debt
Increase in cash in the period	2.6		—		—		0.2		—		0.1		—		—		—		2.9
Cash (outflow)/inflow from increase in debt	(2.8	)	—		0.1		0.3		1.2		0.2		1.5		—		—		0.5
Change in net debt resulting from cash flows	(0.2	)	—		0.1		0.5		1.2		0.3		1.5		—		—		3.4
Debt issued in lieu of interest payment	(7.2	)	—		—		—		—		—		—		—		—		(7.2	)
Other non-cash movements	(0.1	)	—		—		(0.1	)	(0.1	)	(0.2	)	—		—		—		(0.5	)
Exchange adjustments	(8.1	)	—		0.2		(0.2	)	(3.4	)	0.4		(2.8	)	—		0.1		(13.8	)
Movement in net debt in the period	(15.6	)	—		0.3		0.2		(2.3	)	0.5		(1.3	)	—		0.1		(18.1	)
Net debt at the start of the period	(86.5	)	—		(3.2	)	(2.4	)	(32.9	)	(20.4	)	(30.0	)	—		(4.6	)	(180.0	)
Net debt at the end of the period	(102.1	)	—		(2.9	)	(2.2	)	(35.2	)	(19.9	)	(31.3	)	—		(4.5	)	(198.1	)

F-26

Intertek Testing Services Limited Notes To The Consolidated Financial Statements

Issuer, guarantor and non-guarantor companies (continued)

Statements of Cash Flows Nine months to September 30, 1999

	Intertek Testing Services Ltd £m		Testing Holdings USA Inc £m		Kite Overseas Holdings BV £m		ITS Holding Limited £m		Intertek Testing Services UK Limited £m		Testing Holdings Sweden AB £m		Yickson Enterprises Limited £m		Testing Holdings France EURL £m		Testing Holdings Germany GmbH £m		Guarantor subsidiaries Total £m
Total operating cash (outflow)/inflow	(1.6	)	—		—		—		0.5		—		—		—		—		(1.1	)
Returns on investments and servicing of finance	(0.3	)	0.7		(0.2	)	0.7		(1.5	)	(0.8	)	1.3		—		—		(0.1	)
Taxation	—		(0.1	)	—		—		—		—		—		—		—		(0.1	)
Acquisitions	(1.3	)	—		—		—		—		—				(0.1	)	—		(1.4	)
Cash (outflow)/inflow before financing	(3.2	)	0.6		(0.2	)	0.7		(1.0	)	(0.8	)	1.3		(0.1	)	—		(2.7	)
Financing	8.5		(0.6	)	0.1		0.1		1.0		0.8		(1.3	)	0.1		—		8.7
Increase/(decrease) in cash in the period	5.3		—		(0.1	)	0.8		—		—		—		—		—		6.0
Reconciliation of net cash flow to movement in net debt
Increase/(decrease) in cash in the period	5.3		—		(0.1	)	0.8		—		—		—		—		—		6.0
Cash inflow from increase in debt	16.3		—		0.2		0.2		4.6		0.2		1.4		—		—		22.9
Change in net debt resulting from cash flows	21.6		—		0.1		1.0		4.6		0.2		1.4		—		—		28.9
Debt issued in lieu of interest payment	(6.0	)	—		—		—		—		—		—		—		—		(6.0	)
Other non-cash movements	0.1		—		—		—		0.1		—		—		—		—		0.2
Exchange adjustments	(1.5	)	—		0.3		(0.1	)	(1.0	)	—		(0.6	)	—		0.5		(2.4	)
Movement in net debt in the period	14.2		—		0.4		0.9		3.7		0.2		0.8		—		0.5		20.7
Net debt at the start of the period	(80.7	)	—		(3.7	)	(3.4	)	(36.5	)	(21.2	)	(36.3	)	—		(5.2	)	(187.0	)
Net debt at the end of the period	(66.5	)	—		(3.3	)	(2.5	)	(32.8	)	(21.0	)	(35.5	)	—		(4.7	)	(166.3	)

F-27

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant certifies that it meets all of the requirements for filing on Form 6-K and has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.

INTERTEK TESTING SERVICES LIMITED (Registrant)

By:	/s/ WILLIAM SPENCER
	Name: Title: Date:	William Spencer Director November 14, 2000

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