Revenue and cost of sales An analysis of the Group's revenue and cost of sales is as follows: 2011 £'000 2010 £'000 Investment property rental income 61,715 52,583 Trading property sales 641 14,083 Property management fees 1,436 1,161 Revenue 63,792 67,827 Direct operating expenses relating to investment properties that generated rental income (11,702) (10,927) Direct operating expenses relating to investment properties that did not generate rental income (193) - Direct operating expenses (11,895) (10,927) Cost of sales of trading properties (809) (11,084) Cost of sales (12,704) (22,011) Gross profit 51,088 45,816 Total revenue as defined in IAS 18 of £65,183,000 (2010: £68,427,000) includes £1,391,000 (2010: £600,000) interest income.
Operating segments Segment revenues and results Information reported to the Group's Directors for the purposes of resource allocation and assessment of segment performance is focused on the Group's level of investment in property assets and the related net rental income according to geographic location. The Group's reportable segments under IFRS 8 are therefore determined by geographic location. The following is an analysis of the Group's revenue and results by reportable segment: 2011 2010 Revenue £'000 Result £'000 Revenue £'000 Result £'000 Belgium 2,177 1,931 2,874 2,608 France 1,288 1,197 1,566 1,020 Germany 45,145 36,250 34,606 26,495 Netherlands 9,947 8,331 10,769 9,686 UK 5,235 3,379 18,012 6,007 63,792 51,088 67,827 45,816 Other operating income 5,337 - Administrative expenses* (11,483) (9,564) Negative goodwill recognised on acquisition of subsidiaries - 11,532 Costs relating to acquisition of subsidiaries (627) (2,724) Administrative expenses (net) (12,110) (756) Share of results of associate 2,741 588 Operating profit before (losses)/gains on investment properties 47,056 45,648 (Losses)/gains on investment properties by segment: Belgium (4,420) (2,699) France 78 (642) Germany 6,171 11,316 Netherlands (23,186) (9,289) UK 2,033 2,330 Total (losses)/gains on investment properties (19,324) 1,016 Profit on disposal of investment properties 2,722 2,978 (16,602) 3,994 Operating profit 30,454 49,642 Profit on sale of available for sale investment - 1,184 Impairment of available for sale investment (2,901) - Fair value gains/(losses) on foreign currency derivatives 1,344 (2,306) Loss on sale of foreign currency options (915) - Net finance costs* (19,093) (15,337) Profit before tax 8,889 33,183 * Administrative expenses and net finance costs are substantially managed as central costs and are therefore not allocated to segments.
Operating segments continued Segment assets 2011 Investment properties £'000 Trading properties and investment property held for sale £'000 Total properties £'000 Other assets £’000 Total assets £’000 Additions to investment properties £’000 Non- current assets £’000 Belgium 29,044 - 29,044 3,389 32,433 136 30,944 France 13,910 - 13,910 1,473 15,383 - 13,910 Germany 487,858 12,452 500,310 25,767 526,077 25,248 488,648 Netherlands 119,266 - 119,266 6,390 125,656 320 119,924 UK 112,065 17,476 129,541 5,377 134,918 75,799 112,352 Total segment assets 762,143 29,928 792,071 42,396 834,467 101,503 765,778 Unallocated assets 188,251 42,589 Total assets 1,022,718 808,367 2010 Investment properties £'000 Trading properties £'000 Total properties £'000 Other assets £’000 Total assets £’000 Additions to investment properties £’000 Non- current assets £’000 Belgium 33,936 - 33,936 3,939 37,875 86 35,882 France 17,060 - 17,060 642 17,702 - 17,060 Germany 491,396 - 491,396 27,689 519,085 293,485 491,787 Netherlands 145,882 - 145,882 5,540 151,422 488 146,851 UK 39,965 16,397 56,362 3,203 59,565 62,819 39,965 Total segment assets 728,239 16,397 744,636 41,013 785,649 356,878 731,545 Unallocated assets 88,700 34,855 Total assets 874,349 766,400 For the purposes of monitoring segment performance and allocated resources between segments, the Directors monitor the investment and trading properties attributable to each segment. All assets are allocated to reportable segments with the exception of investments in associates and elements of cash, derivatives and tax balances that are managed centrally.