PERNOD RICARD - 2018-2019 Universal registration document

6.

CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements

Defined benefit plans in the Group relate mainly to affiliates in the United Kingdom, in North America and in the rest of Europe. Defined benefit plans are subject to an annual actuarial valuation on the basis of assumptions depending on the country. Under these pension and other benefit plan agreements, employees receive at the date of retirement either a capital lump sum payment or an annuity. These amounts depend on the number of years of employment, final salary and the position held by the employee. At 30 June 2019, fully or partly funded benefit obligations totalled €4,844 million, equivalent to 95% of the total benefit obligations.

Certain affiliates, mainly those located in North America, also provide their employees with post-employment medical cover. These benefit obligations are unfunded. They are measured using the same assumptions as those used for the pension obligations in the countries in question. Several affiliates, mainly in Europe, also provide their employees with other long-term benefits. Benefit obligations of this type are mainly in respect of long-service awards and jubilee awards.

The table below presents a reconciliation of the provision between 30 June 2018 and 30 June 2019:

30.06.2019

30.06.2018

Medical expenses and other employee benefits

Medical expenses and other employee benefits

Pension benefits

Pension benefits

Total

Total

€ million

Net (asset)/ liability at beginning of period

(37)

165

128

(375)

148

(227)

Expenses for the period Actuarial (gains)/losses  (1) Employer contributions

41

9

50

72

8

80

(312)

(12)

(324)

(317)

(1)

(318)

(57)

-

(57) (19)

(51) (15)

-

(51) (25)

Benefits paid directly by the employer Changes in the scope of consolidation

(9)

(10)

(10)

0

0

0

0

0

0

Foreign currency gains and losses

(1)

(5)

(6)

15

2

18

Net (asset)/ liability at end of period

(375)

148

(227)

(671)

147

(524)

Amount recognised in assets  (2)

(754)

-

(754)

(1,083)

-

(1,083)

AMOUNT RECOGNISED IN LIABILITIES (PROVISIONAT ENDOF PERIOD) Recognised as items of other comprehensive income. (1) See Note 4.3 – Financial assets. (2)

379

148

526

412

147

559

The net expense recognised in the income statement in respect of pensions and other long-term employee benefits is broken down as follows:

30.06.2019

30.06.2018

Medical expenses and other employee benefits

Medical expenses and other employee benefits

Pension benefits

Pension benefits

Expense for the year (€ million)

Total

Total

Service cost

44 (2) 137

3 5 5 - - -

47

40

3 5 5 - - -

43 (7)

Interest on provision

3

(12) 139 (151)

O/w interest on the commitment —

143

144 (151)

O/w interest on the assets —

(140)

(140)

O/w interest on the limitation of the assets —

-

-

0

0

Fees/levies/premiums

9

9

10

10

Impact of plan amendments/reduction of future rights

(6) (3)

(1)

(8) (3)

34

0

33

Impact of liquidation of benefits

- 1

- -

- 1

- 1

Actuarial (gains)/losses

-

1

Effect of asset ceiling (including the impact of IFRIC 14) NET EXPENSE/(INCOME) RECOGNISED IN PROFIT ANDLOSS

-

-

-

41

9

50

72

8

80

On 26 October 2018, the ruling of the High Court of Justice in the Lloyds case resulted in an obligation to equalise the value of commitments

resulted in the recognition of an increase of €34 million in the commitment in respect of the Group’s defined benefit plans in the

between men and women in the calculation of the Guaranteed United Kingdom, in other operating income and expenses. Minimum Pension system in the United Kingdom. An initial valuation

182

2018-2019

PERNOD RICARD UNIVERSAL REGISTRATIONDOCUMENT