Exhibit 1

The Body Shop Plc 2001:

Basic Forecasting Results for 2002

Input Data

SALES 422,733
COGS/SALES 0.38
OPERATING EXPENSES/SALES 0.50
INTEREST RATE 0.06
TAX RATE 0.30
DIVIDENDS (Thousand pounds) 10,900
CURR. ASSETS/SALES 0.32
CURR. LIABS./SALES 0.28
FIXED ASSETS 110,600
STARTING EQUITY 121,600

INCOME STATEMENT 2002

SALES 422,733
COGS 160,639
OPERATING EXPENSES 211,367
INTEREST EXPENSE (INCOME) (1,171)
PROFIT BEFORE TAX 51,899
TAX 15,570
PROFIT AFTER TAX 36,329
DIVIDENDS 10,900
EARNINGS RETAINED 25,429

BALANCE SHEET

CURRENT ASSETS 135,275

FIXED ASSETS 110,600
TOTAL ASSETS 245,875

CURRENT LIABILITIES 118,365

DEBT (19,520) 0
EQUITY 147,029
TOTAL LIAB. & NET WORTH 245,875
Based on Exhibit 5 from case

The Body Shop Plc 2001:

Finished Results for 2002, Reflecting Excess Cash

Input Data

SALES 422,733
COGS/SALES 0.38 35-40%
OPERATING EXPENSES/SALES 0.50
INTEREST RATE 0.06
TAX RATE 0.30
DIVIDENDS (Thousand pounds) 10,900
CURR. ASSETS/SALES 0.32
CURR. LIABS./SALES 0.28
FIXED ASSETS 110,600
STARTING EQUITY 121,600

INCOME STATEMENT 2002

SALES 422,733
COGS 160,639
OPERATING EXPENSES 211,367
INTEREST EXPENSE (INCOME) (1,171)
PROFIT BEFORE TAX 51,899
TAX 15,570
PROFIT AFTER TAX 36,329
DIVIDENDS 10,900
EARNINGS RETAINED 25,429

BALANCE SHEET 2002

EXCESS CASH 19,520

CURRENT ASSETS 135,275
FIXED ASSETS 110,600
TOTAL ASSETS 265,395

CURRENT LIABILITIES 118,365

DEBT 0
EQUITY 147,029
TOTAL LIAB. & NET WORTH 265,395

TRIAL ASSETS 245,875

TRIAL LIABILITIES AND EQUITY 265,395
PLUG: DEBT (EXCESS CASH) (19,520)
Sensitivity Analysis

Debt and Excess Cash

By COGS/SALES

COGS/SALES DEBT Ex. CASH

#REF! #REF!

12% 0 19,348 19,348

13% 0 19,520 19,520 1%

14% 0 19,692 19,692 1%

15% 0 19,864 19,864 1%

16% 0 20,036 20,036 1%

17% 0 20,207 20,207 1%

18% 0 20,379 20,379 1%

here we can see that we can get unlimited growth in sales which is not possible because
the capital investment here is kept fixed
The Body Shop Plc 2001:
Hypothetical Three-Year Forecast Worksheet, Drawing on Case Exhibit 8

Fiscal Year Ended February 28

1999 1999 2000 2000

(GBP) (% sales) (GBP) (% sales)
Income Statement

Turnover 303.7 100.00% 330.1 100.0%

Cost of sales 127.7 42.05% 130.9 39.7%
Gross profit 176.0 57.95% 199.2 60.3%

Operating expenses
–excluding exceptional costs 151.4 49.9% 166.2 50.3%
–exceptional costs 4.5 1.5% 0.0 0.0%
Restructuring costs 16.6 5.5% 2.7 0.8%
Net interest expense 0.1 0.4% 1.5 4.1%
Profit before tax 3.4 1.1% 28.8 8.7%
Tax expense 8.0 2.6% 10.4 3.2%
Profit/(loss) after tax (4.6) -1.5% 18.4 5.6%

Ordinary dividends 10.9 3.6% 10.9 3.3%

Profit/(loss) retained (15.5) -5.1% 7.5 2.3%

Fiscal Year Ended February 28

1999 1999 2000 2000

Balance Sheet (GBP) (% sales) (GBP) (% sales)

Assets
Cash 34.0 11.2% 19.2 5.8%
Accounts receivable 27.8 9.2% 30.3 9.2%
Inventories 38.6 12.7% 44.7 13.5%
Other current assets 12.5 4.1% 15.6 4.7%
Net fixed assets 87.8 28.9% 104.7 31.7%
Other assets 0.0 0.0% 6.0 1.8%
Total assets 200.7 66.1% 220.5 66.8%

Liabilities and equity

Accounts payable 13.0 4.3% 20.5 6.2%
Taxes payable 11.3 3.7% 11.7 3.5%
Accruals 10.8 3.6% 15.6 4.7%
Overdrafts 0.0 0.0% 0.3 0.1%
Other current liabilities 21.6 7.1% 13.3 4.0%
Long-term liabilities 28.0 9.2% 36.7 11.1%
Other liabilities 1.7 0.6% 1.0 0.3%
Shareholders' equity 114.3 37.6% 121.4 36.8%
Total liabilities and equity 200.7 66.1% 220.5 66.8%
February 28 Assumptions Forecast

2001 2001
(GBP) (% sales) 2002–2004 2002 2003 2004

374.1 100% 13.0% 422.7 477.7 539.8

149.0 40% 40.5% 171.3 193.5 218.7
225.1 60% balancing fig. 251.5 284.2 321.1

195.7 52.3% 50.8% 214.9 242.8 274.4

11.2 3.0% 0.0% 0.0 0.0 0.0 Mam took =0
1.0 0.3% 0.0% 0.0 0.0 0.0 Mam took =0
4.4 7.2% 6.0% 3.3 3.9 4.5 6%
12.8 3.4% 33.3 37.4 42.2
3.5 0.9% 30.0% 10.0 11.2 12.7
9.3 2.5% 23.3 26.2 29.5

10.9 2.9% 10.90 10.90 10.9 10.9 Fixed

(1.6) -0.4% 12.41 15.307093 18.640721

February 28

2001 2001
(GBP) (% sales) 2002 2003 2004

13.7 3.7% 6.5 0.0 0.0

30.3 8.1% 8.8% 37.2 42.1 47.6
51.3 13.7% 13.3% 56.3 63.6 71.9
17.5 4.7% 4.5% 19.1 21.5 24.3
110.6 29.6% 30.1% 127.1 143.6 162.3
6.7 1.8% 1.2% 5.1 5.7 6.5
230.1 61.5% 251.3 276.6 312.6

10.7 2.9% 4.0% 16.9 19.1 21.6

7.1 1.9% 0.0% 7.1 7.1 7.1 Fixed
 11.5 3.1% 3.5% 14.8 16.7 18.9
0.7 0.2% Plug 0.0 3.6 13.8
16.9 4.5% 4.0% 16.9 19.1 21.6
61.2 16.4% 0.00% 61.2 61.2 61.2
0.4 0.1% 0.0% 0.4 0.4 0.4
121.6 32.5% 134.0 149.3 168.0
230.1 61.5% 251.3 276.6 312.6

Trial Assets 244.8 276.6 312.6

Trial Lia & Eq 251.3 272.9 298.7
Trial Plug -6.5 3.6 13.8
Mam took =0
Mam took =0
The Body Shop Plc 2001:
Hypothetical Three-Year Forecast Worksheet, Drawing on Case Exhibit 8

Fiscal Year Ended February 28

1999 1999 2000 2000

(GBP) (% sales) (GBP) (% sales)
Income Statement

Turnover 303.7 100.00% 330.1 100.0%

Cost of sales 127.7 42.05% 130.9 39.7%
Gross profit 176.0 57.95% 199.2 60.3%

Operating expenses
–excluding exceptional costs 151.4 49.9% 166.2 50.3%
–exceptional costs 4.5 1.5% 0.0 0.0%
Restructuring costs 16.6 5.5% 2.7 0.8%
Net interest expense 0.1 0.4% 1.5 4.1%
Profit before tax 3.4 1.1% 28.8 8.7%
Tax expense 8.0 2.6% 10.4 3.2%
Profit/(loss) after tax (4.6) -1.5% 18.4 5.6%

Ordinary dividends 10.9 3.6% 10.9 3.3%

Profit/(loss) retained (15.5) -5.1% 7.5 2.3%

Fiscal Year Ended February 28

1999 1999 2000 2000

Balance Sheet (GBP) (% sales) (GBP) (% sales)

Assets
Cash 34.0 11.2% 19.2 5.8%
Accounts receivable 27.8 9.2% 30.3 9.2%
Inventories 38.6 12.7% 44.7 13.5%
Other current assets 12.5 4.1% 15.6 4.7%
Net fixed assets 87.8 28.9% 104.7 31.7%
Other assets 0.0 0.0% 6.0 1.8%
Total assets 200.7 66.1% 220.5 66.8%

Liabilities and equity

Accounts payable 13.0 4.3% 20.5 6.2%
Taxes payable 11.3 3.7% 11.7 3.5%
Accruals 10.8 3.6% 15.6 4.7%
Overdrafts 0.0 0.0% 0.3 0.1%
Other current liabilities 21.6 7.1% 13.3 4.0%
Long-term liabilities 28.0 9.2% 36.7 11.1%
Other liabilities 1.7 0.6% 1.0 0.3%
Shareholders' equity 114.3 37.6% 121.4 36.8%
Total liabilities and equity 200.7 66.1% 220.5 66.8%
February 28 Assumptions Forecast

2001 2001
(GBP) (% sales) 2002–2004 2002 2003 2004

374.1 100% 13.0% 422.73 477.69 539.79

149.0 40% 40.0% 169.09 191.08 215.92
225.1 60% balancing fig. 253.64 286.61 323.87

195.7 52.3% 52.0% 219.82 248.40 280.69

11.2 3.0% 0.0% 0.00 0.00 0.00
1.0 0.3% 0.0% 0.00 0.00 0.00
4.4 7.2% 6.0% 3.55 4.28 5.02
12.8 3.4% 30.26 33.94 38.16
3.5 0.9% 30.0% 9.08 10.18 11.45
9.3 2.5% 21.19 23.75 26.71

10.9 2.9% 10.90 10.90 10.90 10.90 Fixed

(1.6) -0.4% 10.29 12.85 15.81

February 28

2001 2001
(GBP) (% sales) 2002 2003 2004

13.7 3.7% Fixed 10.00 10.00 10.00 (Criteria - Minimum cash balance
30.3 8.1% 8.5% 35.93 40.60 45.88
51.3 13.7% 13.7% 57.91 65.44 73.95
17.5 4.7% 4.7% 19.87 22.45 25.37
110.6 29.6% 30.0% 126.82 143.31 161.94
6.7 1.8% 0.0% 6.70 6.70 6.70 Fixed
230.1 61.5% 257.24 288.50 323.84

10.7 2.9% 4.0% 16.91 19.11 21.59

7.1 1.9% 0.0% 7.10 7.10 7.10 Fixed
 11.5 3.1% 3.5% 14.80 16.72 18.89
0.7 0.2% Plug 8.04 20.13 32.51 (If plug shows cash but lesser tha
16.9 4.5% 4.0% 16.91 19.11 21.59
61.2 16.4% 0.00% 61.20 61.20 61.20
0.4 0.1% 0.1% 0.40 0.40 0.40
121.6 32.5% 131.89 144.74 160.55
230.1 61.5% 257.24 288.50 323.84

Trial Assets 247.2 278.5 313.8

Trial Lia & Eq 249.2 268.4 291.3
Trial Plug -2.0 10.1 22.5
Minimum Cash 10.00 10.00 10.00
Plug 8.04 20.13 32.51
Criteria - Minimum cash balance of 10 Million)
f plug shows cash but lesser than 10 Million (minimum balance criteria) then overdraft is increased)
The Body Shop Plc 2001:
Hypothetical Three-Year Forecast Worksheet, Drawing on Case Exhibit 8

Fiscal Year Ended February 28

1999 1999 2000 2000

(GBP) (% sales) (GBP) (% sales)
Income Statement

Turnover 303.7 100.00% 330.1 100.0%

Cost of sales 127.7 42.05% 130.9 39.7%
Gross profit 176.0 57.95% 199.2 60.3%

Operating expenses
–excluding exceptional costs 151.4 49.9% 166.2 50.3%
–exceptional costs 4.5 1.5% 0.0 0.0%
Restructuring costs 16.6 5.5% 2.7 0.8%
Net interest expense 0.1 0.4% 1.5 4.1%
Profit before tax 3.4 1.1% 28.8 8.7%
Tax expense 8.0 2.6% 10.4 3.2%
Profit/(loss) after tax (4.6) -1.5% 18.4 5.6%

Ordinary dividends 10.9 3.6% 10.9 3.3%

Profit/(loss) retained (15.5) -5.1% 7.5 2.3%

Fiscal Year Ended February 28

1999 1999 2000 2000

Balance Sheet (GBP) (% sales) (GBP) (% sales)

Assets
Cash 34.0 11.2% 19.2 5.8%
Accounts receivable 27.8 9.2% 30.3 9.2%
Inventories 38.6 12.7% 44.7 13.5%
Other current assets 12.5 4.1% 15.6 4.7%
Net fixed assets 87.8 28.9% 104.7 31.7%
Other assets 0.0 0.0% 6.0 1.8%
Total assets 200.7 66.1% 220.5 66.8%

Liabilities and equity

Accounts payable 13.0 4.3% 20.5 6.2%
Taxes payable 11.3 3.7% 11.7 3.5%
Accruals 10.8 3.6% 15.6 4.7%
Overdrafts 0.0 0.0% 0.3 0.1%
Other current liabilities 21.6 7.1% 13.3 4.0%
Long-term liabilities 28.0 9.2% 36.7 11.1%
Other liabilities 1.7 0.6% 1.0 0.3%
Shareholders' equity 114.3 37.6% 121.4 36.8%
Total liabilities and equity 200.7 66.1% 220.5 66.8%
February 28 Assumptions Forecast

2001 2001
(GBP) (% sales) 2002–2004 2002 2003 2004

374.1 100% 19.5% 447.05 534.22 638.40

149.0 40% 38.0% 169.88 203.01 242.59
225.1 60% balancing fig. 277.17 331.22 395.81

195.7 52.3% 50.8% 227.10 271.39 324.31

11.2 3.0% 0.0% 0.00 0.00 0.00 Mam took =0
1.0 0.3% 0.0% 0.00 0.00 0.00 Mam took =0
4.4 7.2% 5.0% 1.96 2.28 2.55 6%
12.8 3.4% 48.11 57.55 68.95
3.5 0.9% 30.0% 14.43 17.27 20.69
9.3 2.5% 33.68 40.29 48.27

10.9 2.9% 10.90 10.90 10.90 10.90 Fixed

(1.6) -0.4% 22.78 29.39 37.37

February 28

2001 2001
(GBP) (% sales) 2002 2003 2004

13.7 3.7% Plug 21.99 15.64 10.25

30.3 8.1% 8.0% 35.76 42.74 51.07
51.3 13.7% 13.0% 58.12 69.45 82.99
17.5 4.7% 4.0% 17.88 21.37 25.54
110.6 29.6% 29.0% 129.64 154.93 185.14
6.7 1.8% 0.0% 6.70 6.70 6.70
230.1 61.5% 270.10 310.82 361.68

10.7 2.9% 4.0% 17.88 21.37 25.54

7.1 1.9% 3.5% 7.35 7.61 7.87 Fixed
 11.5 3.1% 3.5% 15.65 18.70 22.34
0.7 0.2% Plug 0.00 0.00 0.00
16.9 4.5% 5.2% 23.25 27.78 33.20
61.2 16.4% 0.00% 61.20 61.20 61.20
0.4 0.1% 0.1% 0.40 0.40 0.40
121.6 32.5% 144.38 173.76 211.13
230.1 61.5% 270.10 310.82 361.68

Trial Assets 248.1 295.2 351.4

Trial Lia & Eq 270.1 310.8 361.7
Trial Plug -22.0 -15.6 -10.2
Minimum Cash 10.00 10.00 10.00
Plug -11.99 -5.64 -0.25
 Best Competitor Practice
%

20
38

52
Mam took =0
Mam took =0
5

8
13
4
29

4
3.5

5.2