PERNOD RICARD - 2018-2019 Universal registration document

5.

MANAGEMENT REPORT Net debt

Net debt 5.3

Reconciliation of Net financial debt – The Group uses net financial debt in the management of its cash and its Net debt capacity. A reconciliation of net financial debt and the main balance sheet items is provided in Note 4.9 – Financial instruments in the Notes to the annual consolidated financial statements. The following table shows the change in Net debt over the year:

30.06.2019

30.06.2018

€ million

Profit fromrecurring operations Other operating income and expenses

2,358

2,581 (206)

(62)

Depreciation of fixed assets —

216

226

Net change in impairment of goodwill and property, plant and equipment and intangible assets —

73

69

Net change in provisions —

(35)

7 3

Restatement of contributions to pension funds acquired fromAllied Domecq and others —

14 (1)

Fair value adjustments on commercial derivatives and biological assets —

(7)

Net (gain)/loss on disposal of assets —

(48)

0

Share-based payments —

35

40

Sub-total of depreciation and amortisation, change in provisions and other SELF-FINANCINGCAPACITY BEFORE FINANCING INTEREST ANDTAX*

254

339

2,549 (100) (659) (358) 1,433

2,714

Decrease/(increase) in working capital requirements

(181) (829) (338)

Net interest and tax payments

Net acquisitions of non-financial assets and other

FREE CASHFLOW

1,366

of which recurring free cash flow

1,422

1,477

Net disposal of financial assets and activities, contributions to pension plans acquired fromAllied Domecq and others

(60)

(181)

Change in the scope of consolidation

- -

- -

Capital increase and other changes in shareholders’ equity —

Dividends and interim dividends paid — (Acquisition)/disposal of treasury shares —

(551) (23)

(645) (121)

Sub-total dividends, purchase of treasury shares and other

(575) 798

(766)

DECREASE/(INCREASE) INDEBT (BEFORE FOREIGN EXCHANGE IMPACT)

420

Opening IFRS 15 impact

16

Foreign currency translation adjustments

91

(94) 342

DECREASE/(INCREASE) INDEBT (AFTER FOREIGN EXCHANGE IMPACT)

889

Net debt at beginning of period

(7,851) (6,962)

(6,962) (6,620)

Net debt at end of period

Excluding investments in pension funds acquired from Allied Domecq. *

150

2018-2019

PERNOD RICARD UNIVERSAL REGISTRATIONDOCUMENT