Barr (A.G.) PLC — Proxy Solicitation & Information Statement 2012

Dec 5, 2012

THIS DOCUMENT AND THE ACCOMPANYING DOCUMENTS ARE IMPORTANT AND REQUIRE YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you are recommended to seek your own personal financial advice immediately from your stockbroker, bank, solicitor, accountant, fund manager or other appropriate independent financial adviser, who is authorised under the Financial Services and Markets Act 2000 if you are in the United Kingdom, or, if not, from another appropriately authorised independent financial adviser.

If you sell, have sold or otherwise transferred all of your A.G. Barr Shares, you should send this document and the accompanying documents as soon as possible to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for delivery to the purchaser or the transferee. However, the distribution of this document and any accompanying documents into certain jurisdictions other than the United Kingdom may be restricted by law and therefore persons into whose possession this document and any accompanying documents come should inform themselves about and observe any such restrictions. Failure to comply with any such restrictions may constitute a violation of the securities laws of any such jurisdiction.

This document should be read in conjunction with the Prospectus relating to A.G. BARR p.l.c. ("A.G. Barr" or the "Company") dated 5 December 2012 in connection with the Merger and which has been published on A.G. Barr's website (www.agbarr.co.uk). This document does not constitute or form part of any offer or invitation to purchase, otherwise acquire, subscribe for, sell, otherwise dispose of or issue, or any solicitation of any offer to sell, otherwise dispose of, issue, purchase, otherwise acquire or subscribe for, any security.

Application will be made to the FSA for the New A.G. Barr Shares to be admitted to the premium listing segment of the Official List, and will be made to the London Stock Exchange for the New A.G. Barr Shares to be admitted to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission will become effective, and that dealings on the London Stock Exchange in the New A.G. Barr Shares will commence, on or shortly after the Effective Date which, subject to the satisfaction of certain conditions, including the sanction of the Scheme by the Court, is expected to occur on 30 January 2013.

A.G. BARR p.l.c.

(incorporated and registered in Scotland with registered number SC005653)

Recommended all-share merger of A.G. BARR p.l.c. and Britvic plc by means of a scheme of arrangement of Britvic plc under Part 26 of the Companies Act 2006

Notice of A.G. Barr General Meeting

Your attention is drawn to the letter from the Chairman of A.G. Barr which is set out on pages 8 to 23 of this document and which recommends you to vote in favour of the Resolutions to be proposed at the A.G. Barr General Meeting referred to below. Please read the whole of this document and, in particular, the risk factors set out in Part II (Risk Factors).

Notice of the A.G. Barr General Meeting to be held at the offices of KPMG LLP, 191 West George Street, Glasgow G2 2LJ at 10.00 a.m. London time on Tuesday, 8 January 2013 is set out at the end of this document. A.G. Barr Shareholders will find enclosed a Form of Proxy for use in connection with the A.G. Barr General Meeting. To be valid, Forms of Proxy should be completed, signed and returned in accordance with the instructions printed on them so as to be received by A.G. Barr's registrars as soon as possible and in any event no later than 10.00 a.m. London time on Sunday, 6 January 2013 (or, in the case of an adjournment, not later than 48 hours before the time fixed for the holding of the adjourned meeting). If you hold shares in CREST, you may be able to use the CREST electronic proxy appointment service. Proxies sent electronically must be sent as soon as possible and, in any event, so as to be received by not later than 10.00 a.m. London time on Sunday, 6 January 2013 (or, in the case of an adjournment, not later than 48 hours before the time fixed for the holding of the adjourned meeting). Completion and return of a Form of Proxy (or electronic appointment of a proxy) will not preclude A.G. Barr Shareholders from attending and voting in person at the A.G. Barr General Meeting should they so wish.

Participants in the A.G. Barr All-Employee Share Ownership Plan will find enclosed a Form of Direction for use in connection with the A.G. Barr General Meeting. Participants in the A.G. Barr All-Employee Share Ownership Plan are asked to complete, sign and return the Form of Direction in accordance with the instructions printed on it so as to be received by A.G. Barr's registrars as soon as possible and in any event no later than 10.00 a.m. London time on Thursday, 3 January 2013 (or, in the case of an adjournment, not later than five days before the time fixed for the holding of the adjourned meeting).

Rothschild, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for A.G. Barr and for no one else in connection with the contents of this document and the Merger and will not be responsible to anyone other than A.G. Barr for providing the protections afforded to its clients or for providing advice in connection with the proposed Merger, the contents of this document or any transaction, arrangement or other matter referred to in this document.

Save for the responsibilities and liabilities, if any, of Rothschild under FSMA or the regulatory regime established thereunder, Rothschild assumes no responsibility whatsoever and makes no representations or warranties, express or implied, in relation to the contents of this document, including its accuracy, completeness or verification or for any other statement made or purported to be made by A.G. Barr, or on A.G. Barr's behalf, or by Rothschild or on Rothschild's behalf, and nothing contained in this document is or shall be relied on as a promise or representation in this respect, whether as to the past or the future, in connection with A.G. Barr or the Merger. Rothschild accordingly disclaims to the fullest extent permitted by law all and any responsibility and liability whether arising in tort, contract or otherwise which it might otherwise be found to have in respect of this document or any such statement.

The New A.G. Barr Shares have not been, and will not be, registered under the US Securities Act of 1933 (the "US Securities Act") or under the securities laws of any state, district or other jurisdiction of the United States. Accordingly, the New A.G. Barr Shares may not be offered, sold, resold, delivered, distributed or otherwise transferred, directly or indirectly, in, into or from the United States absent registration under the US Securities Act or an exemption therefrom. The New A.G. Barr Shares to be issued to existing Britvic Shareholders pursuant to the Scheme are expected to be issued in reliance upon an exemption from the registration requirements of the US Securities Act afforded by Section 3(a)(10) thereof. Britvic Shareholders (whether or not US persons) who are or will be affiliates (within the meaning of the US Securities Act) of A.G. Barr or Britvic prior to, or of the Combined Entity after, the Effective Date will be subject to certain US transfer restrictions relating to the New A.G. Barr Shares received pursuant to the Scheme.

None of the securities referred to in this document have been approved or disapproved by the US Securities and Exchange Commission (the "SEC"), any state securities commission in the United States or any other US regulatory authority, nor have such authorities passed upon or determined the adequacy or accuracy of this document. Any representation to the contrary is a criminal offence in the United States.

Dated: 5 December 2012

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document (including the information incorporated by reference into this document from the Prospectus) contains statements which are, or may be deemed to be, "forward-looking statements" which are prospective in nature. All statements other than statements of historical fact are forward-looking statements. They are based on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forwardlooking statements. Often, but not always, forward-looking statements can be identified by the use of forwardlooking words such as "plans", "expects", "is expected", "is subject to", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes", "targets", "aims", "projects" or words or terms of similar substance or the negative thereof, as well as variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forward-looking statements include statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies and the expansion and growth of A.G. Barr's or Britvic's operations and potential synergies resulting from the Merger; and (iii) the effects of global economic conditions on A.G. Barr's or Britvic's business.

Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors may cause the actual results, performance or achievements of A.G. Barr, Britvic or the Combined Group to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Important factors that could cause actual results, performance or achievements of A.G. Barr, Britvic or the Combined Group to differ materially from the expectations of A.G. Barr, Britvic or the Combined Group, as applicable, include, among other things, general business and economic conditions globally, industry trends, competition, changes in government and other regulations, including in relation to the environment, health and safety and taxation, labour relations and work stoppages, changes in political and economic stability, disruptions in business operations due to reorganisation activities (whether or not A.G. Barr combines with Britvic), interest rate and currency fluctuations, the failure to satisfy any conditions for the Merger (including approvals or clearances from regulatory and other agencies and bodies) on a timely basis or at all, the inability of the Combined Group to realise successfully any anticipated synergy benefits when the Merger is implemented, the inability of the Combined Group to integrate successfully A.G. Barr's and Britvic's operations and programmes when the Merger is implemented, or the Combined Group incurring and/or experiencing unanticipated costs and/or delays or difficulties relating to the Merger when the Merger is implemented. Such forward-looking statements should therefore be construed in light of such factors.

Neither A.G. Barr nor Britvic, nor any of their respective associates or directors, officers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forwardlooking statements in this document (including the information incorporated by reference into this document from the Prospectus) will actually occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as at the date of this document.

A.G. Barr Shareholders should specifically consider the factors identified in this document which could cause actual results to differ before making an investment decision. Such risks, uncertainties and other factors are set out more fully in Part II (Risk Factors). To the extent required by the Listing Rules, the Prospectus Rules and the Disclosure and Transparency Rules of the FSA, the London Stock Exchange or applicable law, A.G. Barr will update or revise the information in this document. Otherwise, A.G. Barr and Britvic expressly disclaim any obligations or undertakings to release publicly any updates or revisions to any forward-looking statements contained in this document (including the information incorporated by reference into this document from the Prospectus) to reflect any change in the expectations of A.G. Barr, Britvic or the Combined Group with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

No statement in this document (including the information incorporated by reference into this document from the Prospectus) is intended to constitute a profit forecast or profit estimate for any period, nor should any statement in this document or incorporated by reference into this document be interpreted to mean that earnings or earnings per ordinary share for A.G. Barr or Britvic, as appropriate, for the current or future financial years will necessarily match or exceed the historical published earnings or earnings per ordinary share for A.G. Barr or Britvic, as appropriate.

TABLE OF CONTENTS

	Page
RELEVANT DOCUMENTATION	4
EXPECTED TIMETABLE OF PRINCIPAL EVENTS	5
INDICATIVE MERGER STATISTICS	6
DIRECTORS, PROPOSED DIRECTORS, COMPANY SECRETARY, REGISTERED OFFICE AND ADVISERS	7
PART I – LETTER FROM THE CHAIRMAN OF A.G. BARR P.L.C.	8
PART II – RISK FACTORS	24
PART III – HISTORICAL FINANCIAL INFORMATION RELATING TO BRITVIC	31
PART IV – PRINCIPAL TERMS OF THE NEW LTIP	97
PART V – ADDITIONAL INFORMATION	100
DEFINITIONS	104
NOTICE OF GENERAL MEETING	109

RELEVANT DOCUMENTATION

A Prospectus dated 5 December 2012 in connection with the Merger has been published on A.G. Barr's website (www.agbarr.co.uk) and contains information regarding, among other things, the reasons for the Merger, further details concerning A.G. Barr, Britvic, historical financial information, the Directors, the Proposed Directors and the New A.G. Barr Shares. The Prospectus is available for inspection in accordance with paragraph 8 of Part V (Additional Information). Paragraph 2 of Part V (Additional Information) sets out the various sections of the Prospectus which are incorporated by reference into this document.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

The dates and times given in the table below in connection with the Merger are indicative only and are based on A.G. Barr's current expectations and may be subject to change (including as a result of changes to Court times, the regulatory timetable and/or the process for implementation of the Merger).

If any of the times and/or dates below change, the revised times and/or dates will be notified by A.G. Barr to A.G. Barr Shareholders by announcement through a Regulatory Information Service.

All references in this document to times and dates are to London times and dates unless otherwise stated.

Event	Time and/or date
Latest time and date for receipt of Forms of Direction for the A.G. Barr General Meeting	10.00 a.m. on 3 January 2013
Latest time and date for receipt of Forms of Proxy for the A.G. Barr General Meeting	10.00 a.m. on 6 January 2013
A.G. Barr General Meeting	10.00 a.m. on 8 January 2013
Britvic Court Meeting	10.00 a.m. on 8 January 2013
Britvic General Meeting	10.15 a.m. on 8 January 2013(1)
Last day of dealings in, and for registration of transfers of, and disablement in CREST of, Britvic Shares	29 January 2013(2)
Scheme Record Time	6.00 p.m. on 29 January 2013(2)
Suspension of listing of, and dealings in, Britvic Shares	By 8.00 a.m. on 30 January 2013(2)
Court Hearing to sanction the Scheme and confirm the Reduction of Capital	30 January 2013(2)
Effective Date	30 January 2013(2)
Issue of the New A.G. Barr Shares and crediting of the New A.G. Barr Shares in uncertificated form to CREST accounts (and cancellation of listing of Britvic Shares)	By 8.00 a.m. on 31 January 2013(2)
Admission and commencement of dealings on the London Stock Exchange of the New A.G. Barr Shares	31 January 2013(2)
Posting of share certificates for the New A.G. Barr Shares (where applicable)	By no later than 11 February 2013(2)
Long Stop Date	30 June 2013(3)

Notes:

(1) To commence at the fixed time or, if later, immediately after the conclusion or adjournment of the Britvic Court Meeting.

(2) These times and dates are indicative only and will depend, amongst other things, on the date upon which: (i) the Conditions are satisfied or (if capable of waiver) waived; (ii) the Court sanctions the Scheme and confirms the Reduction of Capital; and (iii) a copy of the Court Order has been delivered to the Registrar of Companies and, if the Court so orders, the Court Order and the Statement of Capital have been registered by the Registrar of Companies.

(3) This is the latest date by which the Merger may become effective unless A.G. Barr and Britvic agree, and (if required) the Court and the Panel permit, a later date.

(4) In this document, where the context requires, references to 3 December 2012 should be treated as being references to the latest practicable date prior to the publication of this document (unless otherwise stated).

INDICATIVE MERGER STATISTICS

Number of A.G. Barr Shares in issue on 3 December 2012 116,768,778 Number of New A.G. Barr Shares to be issued pursuant to the Merger(1) up to 202,000,000 Number of A.G. Barr Shares in issue upon the Merger becoming Effective(1) up to 318,768,778 The New A.G. Barr Shares as a percentage of the Combined Entity Ordinary Share Capital(1) 63%

Note:

(1) Based on the number of Britvic Shares in issue as at the close of business on 3 December 2012 and assuming that (i) all vested share options under the Britvic Share Schemes are exercised in full and the resulting Britvic Shares are exchanged for New A.G. Barr Shares under the Merger, and (ii) there are no other issues of Britvic Shares or A.G. Barr Shares (including under the A.G. Barr Share Schemes) between 3 December 2012 and the Effective Date.

DIRECTORS, PROPOSED DIRECTORS, COMPANY SECRETARY, REGISTERED OFFICE AND ADVISERS

Directors	Ronald G. Hanna (Non-executive Chairman) Roger A. White (Chief Executive) Alex B. C. Short (Finance Director)(1) Jonathan D. Kemp (Commercial Director)(1) Andrew L. Memmott (Operations Director)(1) W. Robin G. Barr (Non-executive Director) Martin A. Griffiths (Non-executive Director)
	all of Westfield House, 4 Mollins Road, Cumbernauld G68 9HD
Proposed Directors(2)	Gerald Corbett John Gibney Joanne Averiss Bob Ivell Ben Gordon John R. Nicolson
Company Secretary	Julie A. Barr
Registered office	Westfield House 4 Mollins Road Cumbernauld G68 9HD
Financial Adviser and Sponsor	Rothschild New Court St Swithin's Lane London EC4N 8AL
Auditors and reporting accountants to the Company	KPMG Audit Plc Chartered Accountants 191 West George Street Glasgow G2 2LJ
	Ernst & Young LLP 400 Capability Green Luton Bedfordshire LU1 3LU
Legal advisers to the Company	Dickson Minto W.S. 16 Charlotte Square Edinburgh EH2 4DF
Registrars	Equiniti Limited Aspect House Spencer Road Lancing BN99 6DA

Notes:

(1) Alex B.C. Short, Jonathan D. Kemp and Andrew L. Memmott will retire as Directors with effect from the Effective Date.

⁽²⁾ The Proposed Directors will become directors of the Combined Entity with effect from the Effective Date, save for John R. Nicolson who will become a director of A.G. Barr on 1 January 2013.

PART I

LETTER FROM THE CHAIRMAN OF A.G. BARR P.L.C.

A.G. BARR p.l.c.

(incorporated and registered in Scotland with registered number SC005653)

Directors Registered office

Ronald G. Hanna (Non-executive Chairman) Westfield House Roger A. White (Chief Executive) 4 Mollins Road Alex B. C. Short (Finance Director) Cumbernauld Jonathan D. Kemp (Commercial Director) G68 9HD Andrew L. Memmott (Operations Director) W. Robin G. Barr (Non-executive Director) Martin A. Griffiths (Non-executive Director)

5 December 2012

To A.G. Barr Shareholders, persons with information rights and participants in the A.G. Barr All-Employee Share Ownership Plan

RECOMMENDED ALL-SHARE MERGER OF A.G. BARR AND BRITVIC

1. Introduction

On 14 November 2012, the boards of A.G. Barr and Britvic announced that they had agreed the terms of a recommended all-share merger of A.G. Barr and Britvic.

The terms of the Merger will provide Britvic Shareholders with 0.816 New A.G. Barr Shares for each Britvic Share held. It is intended that the Merger will be effected by way of a Court-sanctioned scheme of arrangement of Britvic under Part 26 of the Companies Act pursuant to which A.G. Barr will acquire the entire issued and to be issued ordinary share capital of Britvic. It is proposed that the Combined Entity will be called "Barr Britvic Soft Drinks plc". Subject to the satisfaction or, where applicable, waiver of the Conditions, it is expected that the Merger will become Effective on 30 January 2013.

Owing to its size, the Merger constitutes a "reverse takeover" for the purposes of the Listing Rules and therefore requires the approval of A.G. Barr Shareholders. Accordingly, the A.G. Barr General Meeting has been convened for 10.00 a.m. London time on Tuesday, 8 January 2013 at the offices of KPMG LLP, 191 West George Street, Glasgow G2 2LJ. A.G. Barr Shareholders will be asked, amongst other things, to approve the Merger itself and the allotment of A.G. Barr Shares in connection with the Merger. An explanation of the Resolutions to be proposed at the A.G. Barr General Meeting is set out in paragraph 20 below.

The Directors consider the Merger and the Resolutions to be in the best interests of A.G. Barr and A.G. Barr Shareholders as a whole and unanimously recommend that A.G. Barr Shareholders vote in favour of the Resolutions, as the Directors who hold or are beneficially entitled to A.G. Barr Shares have irrevocably undertaken to do in respect of their own beneficial holdings of A.G. Barr Shares. The Merger has also been unanimously recommended by the Britvic Directors.

I am writing to give you further details of the Merger, including the background to and reasons for it, to explain why the A.G. Barr Board considers it to be in the best interests of A.G. Barr and A.G. Barr Shareholders as a whole and to seek your approval of the Resolutions. A Prospectus prepared in accordance with the Prospectus Rules, which contains further details of the Merger, has been published on the Company's website (www.agbarr.co.uk) and accompanies this document.

2. Summary of the terms of the Merger

Under the terms of the Merger, and subject to the Conditions and certain further terms, if the Scheme becomes effective Britvic Shareholders will receive:

For each Britvic Share 0.816 New A.G. Barr Shares

On the basis of A.G. Barr's closing share price of 472.50 pence on 3 December 2012, the Merger values each Britvic Share at 385.56 pence and the entire issued share capital of Britvic at approximately £935 million.

Britvic Shareholders will hold approximately 63 per cent. and A.G. Barr Shareholders will hold approximately 37 per cent. of the issued share capital of the Combined Entity as at the Effective Date.

The Scheme and the Conditions relating to the Merger are summarised at paragraph 11 below.

3. Background to and reasons for the Merger

The Merger will create one of the leading soft drinks companies in Europe, with annual sales of over £1.5 billion, a portfolio of strong brands and significant prospects for future growth. The combination has compelling commercial and industrial logic given the high level of complementarity between the two businesses in terms of brands, sales channel presence and geographic presence within the United Kingdom.

The boards of A.G. Barr and Britvic believe that the Combined Group will be a stronger soft drinks platform than each of the two companies separately and, therefore, the Merger is an opportunity for both companies and their respective shareholders to benefit from the resulting improvement in the Combined Group's ability to compete successfully in the long term. Underpinning the commercial and industrial logic is the potential to achieve significant synergies. The Combined Group will also benefit from the collective talent of the respective management teams who will seek to ensure the successful integration of the two businesses and focus on delivering the business strategy for the Combined Group.

Attractive portfolio of strong and differentiated brands provides platform for growth

The boards of A.G. Barr and Britvic believe that the Combined Group will possess an attractive portfolio of strong and differentiated brands. The Combined Group's brand portfolio will be well represented in key sub-segments of the soft drinks market.

Britvic's portfolio of owned international brands, such as Robinsons, Robinsons Fruit Shoot and Teisseire, alongside strong national brands such as J2O, Tango, juicy drench, Britvic, R Whites, Fruité, Moulin de Valdonne, Ballygowan, Club and MiWadi, will be combined with A.G. Barr's brands and complementary portfolio, including its unique brand IRN-BRU, and its Rubicon, KA, Barr and Strathmore brands.

Britvic enjoys a strong relationship with the Pepsi Group and the Pepsi Group is supportive of a combination of A.G. Barr and Britvic. Britvic has exclusive bottling and distribution agreements with the Pepsi Group in Great Britain for a number of Pepsi Group brands including Pepsi, 7UP, Gatorade, Mountain Dew and SoBe, and for Pepsi, 7UP and Mountain Dew in Ireland. The Combined Group is committed to maintaining and developing its successful relationship with the Pepsi Group. Conditional on the Merger becoming Effective, the Pepsi Group and Britvic have agreed certain variations to the contractual terms of the Pepsi Group's exclusive bottling and distribution agreements with Britvic (to reflect the operations of the Combined Group following the Merger) and, on the basis of these revised terms, the Pepsi Group has agreed not to exercise any rights of termination it may have as a consequence of the Merger under these agreements.

The Combined Group's franchised brand portfolio is further complemented by A.G. Barr's licensed brands including Orangina and Rockstar and by Britvic's exclusive agreement with Pepsi Lipton International Limited for Lipton Ice Tea. These agreements provide further important brands to the portfolio of the Combined Group.

The complementary nature of the respective brands of A.G. Barr and Britvic will enable the Combined Group to offer consumers a wider choice of products and brands and to cater for a broader set of preferences and purchasing occasions. As such, the boards of A.G. Barr and Britvic believe that the Combined Group can become a more attractive supplier to its customers across all channels which will create benefits in terms of enhanced brand representation.

The Merger will also bring together significant expertise in soft drinks innovation, as demonstrated by the respective track records of both A.G. Barr and Britvic of successful new product launches, new flavour introductions, new packaging formats and enhancements alongside innovative and differentiated marketing campaigns.

The Combined Group expects to continue to invest significantly in its brand portfolio, both owned and franchised/licensed, building brand equity for the long term for the benefit of consumers, customers, brand partners and shareholders.

Complementary channel and geographic presence

Based on the complementary channel and geographic presence of A.G. Barr and Britvic, the Combined Group will be well positioned to extend its offering to both customers and consumers.

The Combined Group will be able to utilise its enhanced sales and distribution network and, in particular, Britvic's focus on the national grocery chains and its contracts with licensed on-trade outlets as well as A.G. Barr's Direct Store Delivery model that supplies small retail convenience stores.

The Combined Group's brand portfolio will benefit from enhanced routes to market and is expected to drive opportunities for further revenue growth. Internationally, the Combined Group will enjoy significant presence in France and Ireland, and growing distribution of proprietary brands in markets such as the USA, Australia, Netherlands and Russia.

Financial strength

Following the completion of the Merger, the Combined Group will have a robust long term capital structure further underpinned by the prospects for delivery of synergies and organic cash generation.

Necessary approvals have been obtained to keep in place all of Britvic's existing committed sources of financing, including Britvic's £400 million revolving credit bank facility (which matures in 2016) and Britvic's £491 million US private placement notes (which mature between 2014 and 2022), providing a strong capital base for the Combined Group.

The Combined Group's sources of funding will provide appropriate financial and strategic flexibility going forward and enable it to maintain levels of strategic investment in marketing, innovation and capital expenditure and provide flexibility for organic growth initiatives and potential future acquisition opportunities.

4. Synergies and integration

Following preliminary analysis undertaken by the boards of A.G. Barr and Britvic, opportunities for significant cost and net revenue synergies have been identified which underpin the industrial logic and shareholder value creation opportunity of the Merger. The boards of A.G. Barr and Britvic believe that the Combined Group will be able to achieve recurring annual cost synergies of approximately £35 million and the Merger will provide an opportunity to achieve a contribution of at least £5 million from annual net revenue synergies. The boards of A.G. Barr and Britvic expect to build up synergies progressively, minimising risk, in order to achieve aggregate, full run rate synergies of £40 million in 20161. The synergies identified reflect both the beneficial elements and costs and could not be achieved independently.

Overhead cost savings are expected to arise from the elimination of corporate overheads (including administrative costs, support functions, governance and head office costs in HR, finance and IT) where there is duplication. There are expected also to be savings on procurement costs coming from greater scale in direct procurement of key overlapping raw materials, as well as in indirect procurement such as media, trade marketing and third party external production.

The Merger offers the opportunity to optimise the combined operational footprint, increasing manufacturing capacity utilisation and thereby enabling better use of fixed production costs. It is expected that the Combined Group will be able to benefit from a reconfiguration of the supply chain resulting in improved line efficiencies and a reduction in headcount and the number of factories. Furthermore, it is likely that the new facility that A.G. Barr is in the process of constructing in Milton Keynes will provide new capacity which will offer greater operational flexibility for the Combined Group.

In addition to these cost synergies, the boards of A.G. Barr and Britvic believe that the Merger will provide an opportunity to achieve recurring net revenue synergies through utilising the combined distribution channels, brand portfolios and geographic presence of the Combined Group, which will drive enhanced market access for the Combined Group's products.

The boards of A.G. Barr and Britvic expect £3 million of savings will be realised in the first 12 months after completion of the Merger, rising to approximately £16 million in the second year after completion of the Merger and approximately £30 million in the third year after completion of the Merger, with the full run rate cost and net revenue synergies of £40 million being realised in 20161.

It is expected that realisation of these synergies will result in one-off exceptional costs of approximately £40 million, of which £11 million would be incurred in the first 12 months after completion of the Merger and approximately £29 million in the second year after completion of the Merger. It is also expected that to achieve

¹ These statements are not intended as a profit forecast and should not be interpreted to mean that earnings per A.G. Barr or Britvic ordinary share for the current or future financial years would necessarily match or exceed the historical published earnings per A.G. Barr or Britvic ordinary share.

the synergies, capital expenditure of approximately £8 million will be incurred in the first 12 months after completion of the Merger. In addition, there may be a requirement for a non-cash write off of certain assets following the review of the combined operational footprint but as yet these have not been identified.

The realisation of cost synergies will involve a reduction of headcount and places of business where there is opportunity to achieve efficiencies and rationalise the Combined Group's manufacturing footprint. The directors of A.G. Barr and Britvic believe the net reduction in Combined Group headcount is likely to be in the range of 8- 12 per cent. The number of employees and locations affected will depend on the outcome of the integration planning and these changes will only come into effect as synergies are realised over the three years post completion.

Alex Short (A.G. Barr CFO) will be appointed as Integration Director and will oversee the integration process. It is envisaged that the Combined Group will establish a full integration team, bringing together the best relevant capability of both businesses, to ensure that the synergies of the Merger are maximised. The boards are confident that the integration of A.G. Barr and Britvic can be achieved without undue disruption to the underlying operations of each business.

As at the date of this document, an outline integration plan is being developed. The output of that plan will be an agreed definition of integration scope, quantified objectives, proposed organisation structures and processes to be reviewed and subsequently implemented, together with an overall integration programme and stakeholder communication timetable.

As soon as practicable following the Effective Date, the Combined Group will aim to have fully validated its initial synergy assumptions, agreed the target operating model of the Combined Group and completed a detailed integration plan across the Combined Group's business. A.G. Barr and Britvic also aim to have completed the principal elements of the restructuring of the Combined Group which will include all senior management appointments, reporting structures and operational and executive authority limits, and changes to key Combined Group policies and processes. The latter will include financial reporting, planning and budgetary processes, compensation, treasury and liquidity management policies, sustainability practices, and reviewing the scope of internal audit and risk registers.

5. Information on Britvic

Britvic is one of Europe's leading soft drinks companies, with a broad portfolio of leading brands such as Robinsons, J2O, Fruit Shoot, R Whites, Britvic, Purdeys, juicy drench, drench, Pennine Spring and Tango in GB, MiWadi, Club, Cidona and Ballygowan in Ireland, and Teisseire, Moulin de Valdonne, Fruité and Pressade in France. Britvic also has exclusive bottling agreements with the Pepsi Group in the UK and Ireland to manufacture and distribute global brands such as Pepsi, Pepsi Max, 7UP and Mountain Dew. Collectively Britvic employs approximately 3,300 people.

The Britvic Group's revenue for the 52 weeks ended 30 September 2012 was £1,256.4 million and it had an operating profit pre-exceptional and other items of £112.7 million and profit before tax pre-exceptional and other items of £84.4 million (as extracted without material adjustment from Britvic's unaudited Preliminary Results referenced in Part III (Historical Financial Information Relating to Britvic). The Preliminary Results also state that the Britvic Group had gross assets of £1,025.8 million as at 30 September 2012.

Britvic Shares are traded on the London Stock Exchange and the company is a member of the FTSE 250 index.

Current trading, trends and prospects

Britvic released its Preliminary Results for the 52 weeks ended 30 September 2012 on 27 November 2012, which included the following statement:

"Britvic has delivered some notable successes in the last twelve months. Our GB carbonates brands, and Pepsi in particular, significantly outperformed the market in this Olympic year, Robinsons squash returned to its two year historic high share of the market, our syrups brands in France increased volume and value share, and the expansion of our US franchise business developed in line with our stated plan.

In other respects, this has been a difficult year for the group and the progress that we made was more than offset by the impact of the Fruit Shoot product recall. Additionally, the negative macro-economic trends, leading to weak consumer confidence and the cold, wet summer endured across most of our markets, weighed heavily on the soft drinks market and Britvic within it.

The Fruit Shoot product recall was regrettable, but necessary in order to protect the safety of our consumers. The business responded quickly and efficiently to manage the situation and refocused our priorities as required over the balance of the year."

Since 27 November 2012 Britvic's trading has progressed in line with its expectations.

6. Information on A.G. Barr

A.G. Barr is one of the leading soft drinks businesses in the UK. Established in 1875, A.G. Barr has been in the business of producing, marketing and selling soft drinks for over 100 years, primarily in the UK but with a growing level of international sales. A.G. Barr has developed a balanced portfolio of proprietary carbonated and still brands, including IRN-BRU, Barr range, Rubicon, KA, Barr's Originals, Strathmore, Tizer, D'N'B, St Clements, Simply, Sun Exotic and Findlays. A.G. Barr is also a franchisee of the Orangina Schweppes Group in the UK, where A.G. Barr manufactures and sells Orangina products under licence. A.G. Barr also has a franchise arrangement with Rockstar, Inc. to sell and distribute Rockstar energy drinks throughout the UK and Ireland. The A.G. Barr Group employs approximately 980 people.

For the 52 weeks ended 28 January 2012, A.G. Barr's revenue was £223 million (2011: £209 million) and it made profit before tax of £35 million (2011: £30 million) and profit before tax and exceptional items of £34 million (2011: £32 million) (as extracted without material adjustment from the audited restated historical financial information of A.G. Barr in Part V of the accompanying Prospectus). For the six months ended 28 July 2012, A.G. Barr's revenue was £122 million (2011: £117 million) and it made profit before tax and exceptional items of £15 million (2011: £16 million) (as extracted without material adjustment from the unaudited restated historical financial information of A.G. Barr in Part VI of the accompanying Prospectus).

A.G. Barr Shares are traded on the London Stock Exchange and the company is a member of the FTSE 250 index.

Current trading, trends and prospects

On 24 September 2012 A.G. Barr announced that:

"We expect trading to remain challenging over the coming months and we have put in place cost control measures and a robust trading programme for the balance of our financial year. Assuming there is no further deterioration in the market, we remain confident about our prospects."

Since 24 September 2012 A.G. Barr's trading has progressed in line with its expectations.

7. Strategy of the Combined Group

Following the Merger, the Combined Group will aim to deliver strong revenue and profit growth supported by attractive cash returns. The boards of A.G. Barr and Britvic believe that the breadth and balance of the Combined Group's portfolio of brands, its longstanding customer relationships and its operational scale will provide a strong platform for growth in the soft drinks markets in which the Combined Group operates. In addition, its consumer insight, proven innovation and brand development expertise means that the Combined Group will be well positioned to identify and capitalise on consumer and customer trends, underpinning its growth potential.

The Combined Group's strategy will focus on creating value by driving both the availability of its brands and operational efficiency. The Combined Group will seek to:

• grow and develop its core brands;
• deliver sustainable profitable growth in its established markets and internationally through franchised brands;
• energise and enable its people in a performance driven culture; and
• act responsibly, building the respect and the trust of all its stakeholders.

The Combined Group has also identified immediate business priorities, which provide a focus on integration, delivery of the synergies and business optimisation whilst also growing underlying business performance. With a stronger balance sheet, the Combined Group will be better positioned to pursue joint ventures and acquisitions over the medium term.

8. Management, employees and locations of business

It is proposed that the Combined Group Board will be reconstituted immediately following the Merger becoming Effective so as to comprise ten directors, including eight non-executive directors. As from the Effective Date, Gerald Corbett (Britvic) will be non-executive Chairman, Ronald Hanna (A.G. Barr) will be non-executive Deputy Chairman and Senior Independent Director, and Robin Barr (A.G. Barr), Martin Griffiths (A.G. Barr), John Nicolson (A.G. Barr), Joanne Averiss (Britvic), Bob Ivell (Britvic) and Ben Gordon (Britvic) will be non-executive directors. The executive directors will comprise Roger White (A.G. Barr) as Chief Executive Officer and John Gibney (Britvic) as Chief Financial Officer.

Alex Short, Jonathan Kemp and Andrew Memmott will step down from the A.G. Barr Board upon the Scheme becoming effective. Each of the A.G. Barr Directors stepping down from the A.G. Barr Board is fully supportive of the rationale for the Merger and of its terms and conditions.

Paul Moody and Michael Shallow will step down from the board of Britvic upon the Scheme becoming effective and will not join the Combined Group Board. Each of the Britvic Directors stepping down from the board of Britvic is fully supportive of the rationale for the Merger and of its terms and conditions.

A.G. Barr and Britvic attach great importance to the skills and experience of the existing management and employees of A.G. Barr and Britvic and believe that they will benefit from greater opportunities within the Combined Group.

The Executive Committee of the Combined Group will be drawn from the management teams of both companies, based on merit.

The senior management structure of the Combined Group will be constructed to ensure that the Combined Group benefits from the best skills and experience of both companies.

The boards of A.G. Barr and Britvic recognise that in order to achieve the expected benefits of the Merger, operational and administrative restructuring will be required following completion of the Merger.

It is envisaged that the Combined Entity's legal headquarters and registered office will be located at A.G Barr's existing head office in Cumbernauld. The operational headquarters of the Combined Group will be located at Britvic's existing head office in Hemel Hempstead.

Following preliminary analysis undertaken by the boards of A.G Barr and Britvic, it is envisaged that areas of overlapping corporate, commercial, operational and support functions will be identified as part of the integration review and decisions taken to implement rationalisation, which will involve some headcount reduction, although specific roles have not yet been identified.

The integration review will build on the synergy work carried out to date and will consider the Combined Group's manufacturing footprint. This process will produce a detailed integration plan for agreement by the Combined Group Board which will involve a reduction of headcount and places of business where there is opportunity to achieve efficiencies and rationalise the Combined Group's manufacturing footprint. The directors of A.G. Barr and Britvic believe the net reduction in Combined Group headcount is likely to be in the range of 8- 12 per cent. The number of employees and locations affected will depend on the outcome of the integration planning and these changes will only come into effect as synergies are realised over the three years post completion.

It is likely that the Combined Group will accelerate the fitting out and commissioning of the new plant at Milton Keynes which was to be undertaken by A.G Barr, but the exact details will be confirmed in light of the conclusions of the broader integration review.

A.G Barr has given assurances to the Britvic Directors that, following completion of the Merger, it is intended that the existing employment rights of Britvic's employees will be fully safeguarded.

9. Financial and accounting considerations

On a pro forma basis and assuming completion of the Merger had occurred on 28 July 2012, the Combined Group would have had net assets of £584.3 million at that date (based on the net assets of A.G. Barr as at 28 July 2012 and Britvic as at 30 September 2012), as more fully set out in the unaudited pro forma financial information of the Combined Group in Part X of the accompanying Prospectus.

The Merger is expected to be earnings enhancing for A.G. Barr Shareholders in the first full financial year following the Effective Date as a result of the earnings of the Britvic Group being consolidated with those of the A.G. Barr Group and before synergies. The realisation of the expected synergies should create significant value for the shareholders of both A.G. Barr and Britvic.

The Combined Entity will adopt Britvic's accounting policies. The A.G. Barr financial year ends at the end of January and the Britvic financial year ends at the end of September. The Combined Entity will look at the merits of adopting each of these year ends but its intention is to retain a January financial year end. For accounting purposes it is expected that A.G. Barr will be merged into Britvic's balance sheet. A.G. Barr's assets and liabilities will be fair valued at the acquisition resulting in the valuation of A.G. Barr's brands being included on the Combined Group's balance sheet. Intangibles arising will include goodwill and brands.

10. Dividends and dividend policy

In recognition of distributable profits earned in the period to completion of the Merger, it is expected that A.G. Barr Shareholders and Britvic Shareholders will be paid dividends under their respective existing dividend policies in relation to the period up to the Effective Date, expected to be in February 2013, as set out below:

A.G. Barr

The A.G. Barr Directors intend to declare a second interim dividend for the year ending 26 January 2013 of 7.4p per share to be paid on 18 January 2013 to A.G. Barr Shareholders on the register on 4 January 2013, in lieu of the final dividend for the financial year ending 26 January 2013. Together with the interim dividend of 2.6p per share paid to A.G. Barr Shareholders on 19 October 2012, this gives a total dividend for the year ending 26 January 2013 of 10.0p per share, an increase of approximately 7.5 per cent. on the dividend paid for the year ended 28 January 2012.

Britvic

The Britvic Directors intend to declare a second interim dividend in lieu of the final dividend for the financial year ended 30 September 2012 of 12.4p per share. Together with the interim dividend of 5.3p per share paid to Britvic Shareholders on 13 July 2012, this gives a total dividend of 17.7p per share for the financial year ended 30 September 2012, consistent with the prior financial year. The second interim dividend will be paid on 18 January 2013 to Britvic Shareholders on the register on 7 December 2012.

Additionally, the Britvic Directors intend to declare a special interim dividend of 10.0p per share, conditional upon the Merger becoming Effective, in lieu of the dividend in relation to the period from 1 October 2012 until the Effective Date, and in recognition of the Combined Group's dividend policy. This will be paid after the Effective Date to Britvic Shareholders on the register at the Scheme Record Time. The special dividend will extend to any Britvic Shares that are unconditionally allotted or issued pursuant to the exercise of options or the vesting of awards granted under the Britvic Share Schemes, in each case on or prior to the Scheme Record Time. Together with the interim dividends of 17.7p per share, this gives a total dividend for the period (expected to be around 16 months, from 1 October 2011 until the Effective Date) of 27.7p per share.

Dividend policy

Following completion of the Merger, it is expected that the Combined Entity will adopt a progressive dividend policy with a dividend cover ratio of between 2.0 to 2.5 times calculated on an adjusted earnings per share basis.

Assuming that the Combined Entity operates with a January financial year end, it is expected that interim dividends for the period to July will be declared in September and paid in October and final dividends for the period to January will be declared in March and paid in June of the following year. Assuming that the Merger will be completed in February 2013, as currently anticipated, an interim dividend would (subject to the usual considerations), therefore, be declared in September 2013.

The Combined Group Board will decide the absolute level of interim and final dividends to be paid for the year to January 2014 at the relevant time in light of the performance and cashflow of the Combined Group and the rate at which synergies are being realised.

11. Structure of the Merger

It is intended that the Merger will be implemented by way of a Court-sanctioned scheme of arrangement between Britvic and the Britvic Shareholders, under Part 26 of the Companies Act.

The purpose of the Scheme is to provide for A.G. Barr to become the owner of the entire issued and to be issued ordinary share capital of Britvic. This is to be achieved by the cancellation of the Britvic Shares held by Britvic Shareholders and the application of the reserve arising from such cancellation in paying up in full such number of new Britvic Shares as is equal to the number of Britvic Shares cancelled, and issuing those new shares to A.G. Barr in consideration of the issue of New A.G. Barr Shares to Britvic Shareholders on the register of members at the Scheme Record Time on the basis set out in paragraph 2 above.

The Merger is subject to the Conditions and certain further terms and will only become Effective if, among other things, the following events occur on or before 30 June 2013 or such later date as A.G. Barr and Britvic may agree and (if required) the Court and the Panel may allow:

• (a) a resolution to approve the Scheme being passed by a majority in number of the Britvic Shareholders who are present and voting at the Britvic Court Meeting, either in person or by proxy, representing 75 per cent. or more in value of the Britvic Shares voted by those Britvic Shareholders;
• (b) the Special Resolution necessary to implement the Scheme and to approve the related Reduction of Capital being passed by the requisite majority of Britvic Shareholders at the Britvic General Meeting;
• (c) the Scheme being sanctioned (with or without modification, on terms agreed by A.G. Barr and Britvic) and the related Reduction of Capital being confirmed by the Court;
• (d) a copy of the Court Order (together with the Statement of Capital) being delivered to the Registrar of Companies and, if so ordered by the Court, the Court Order being registered by the Registrar of Companies together with the Statement of Capital;
• (e) the OFT indicating, either unconditionally or subject to the giving of undertakings reasonably satisfactory to A.G. Barr and Britvic, that it does not intend to refer the Merger or any part of it to the Competition Commission;
• (f) the Merger Resolution to be proposed at the A.G. Barr General Meeting to approve the transaction as a "reverse takeover" under the Listing Rules, to grant authority to the Directors to allot the New A.G. Barr Shares and to increase the borrowing limits set out in the A.G. Barr Articles being passed by the requisite majority of A.G. Barr Shareholders (but, for the avoidance of doubt, not the other resolutions to be proposed at the A.G. Barr General Meeting which shall not be conditions to the Merger); and
• (g) the UK Listing Authority having acknowledged to A.G. Barr or its agent (and such acknowledgement not having been withdrawn) that the application for the admission of the New A.G. Barr Shares to the premium segment of the Official List has been approved and (subject to satisfaction of any conditions to which such approval is expressed) will become effective as soon as a dealing notice has been issued by the UK Listing Authority and the London Stock Exchange having acknowledged to A.G. Barr or its agent (and such acknowledgement not having been withdrawn) that the New A.G. Barr Shares will be admitted to trading.

A.G. Barr reserves the right to waive, with Britvic's prior written consent, in whole or part, the Condition summarised in paragraph (e) above.

Upon the Scheme becoming effective it will be binding on all Britvic Shareholders, irrespective of whether or not they attended or voted at the Britvic Court Meeting or the Britvic General Meeting (and if they attended and voted, whether or not they voted in favour), and share certificates in respect of Britvic Shares will cease to be valid and entitlements to Britvic Shares held within the CREST system will be cancelled.

Britvic Shares will be acquired by A.G. Barr pursuant to the Scheme fully paid and free from all liens, charges, equities, encumbrances, rights of pre-emption and any other interests of any nature whatsoever and together with all rights attaching thereto, including voting rights and the rights to receive and retain in full all dividends and other distributions declared, made or paid on or after the Effective Date, save where the record date for such dividend or other distribution falls prior to the Effective Date or otherwise where A.G. Barr and Britvic agree.

The New A.G. Barr Shares issued to Britvic Shareholders pursuant to the Scheme will be issued credited as fully paid and will rank pari passu in all respects with existing A.G. Barr Shares, including the right to receive dividends and other distributions declared, made or paid on A.G. Barr Shares by reference to a record date falling after the Effective Date. The New A.G. Barr Shares will be issued in registered form and will trade under the same ISIN number as the existing A.G. Barr Shares.

Fractions of New A.G. Barr Shares allotted and issued pursuant to the Merger will not be allotted and issued to those Britvic Shareholders participating in the Scheme but will be aggregated and sold in the market as soon as practicable after the Effective Date, and the net proceeds of sale paid to such holders in due proportions.

A.G. Barr has reserved the right, subject to the consent of the Panel and with Britvic's prior written consent (such consent to also be required in the case of any offer to be made by A.G. Barr if the Condition summarised in paragraph (e) above is not satisfied), to elect to implement the Merger by way of a Merger Offer. Subject to the receipt of such consent, in such event, the Merger would be implemented on substantially the same terms, subject to appropriate amendments (including, without limitation, an acceptance condition set at 90 per cent. (or such lesser percentage, being more than 50 per cent., as A.G. Barr may decide) of the shares to which the Merger Offer relates and of the voting rights carried by those shares).

If the Scheme does not become effective on or before 30 June 2013 (or such later date as A.G. Barr and Britvic may agree), it will lapse and the Merger will not proceed.

The Scheme Document setting out the procedures to be followed by Britvic Shareholders in relation to the Scheme is being posted to Britvic Shareholders on or around the date of this document.

12. Antitrust approvals

The Merger is subject to the UK merger control process. A.G. Barr and Britvic have made a notification to the OFT by way of informal submission. This notification has commenced a review process during which the OFT aims to adhere to a 40 working day administrative timetable for consideration of the Merger. At the end of the OFT review period the OFT may approve the Merger unconditionally or subject to undertakings in lieu of reference, or may refer the Merger or any matter arising from it to the Competition Commission.

The Merger will automatically lapse if the Merger or any matter arising from it is referred by the OFT to the Competition Commission prior to the Britvic Court Meeting. The Merger will also lapse if A.G. Barr invokes the relevant Condition as a result of the Merger or any matter arising from it being referred by the OFT to the Competition Commission after the Britvic Court Meeting or as a result of OFT clearance being subject to terms (including as to divestiture remedies) which are not reasonably satisfactory to it and Britvic.

13. Employee share schemes

A.G. Barr currently has four share schemes in place: the A.G. Barr All-Employee Share Ownership Plan, the A.G. Barr Executive Share Option Scheme, the A.G. Barr Savings Related Share Option Scheme and the A.G. Barr Long Term Incentive Plan. Britvic currently has three share schemes in place: the Britvic Executive Share Option Plan, the Britvic Performance Share Plan and the Britvic Share Incentive Plan. Further details of these schemes are contained in paragraphs 10 and 11 of Part XII of the accompanying Prospectus.

The proposed Remuneration Committee of the Combined Group has considered its remuneration strategy for the directors, senior managers and other employees of the Combined Group following the Merger becoming Effective. Details of the proposed share schemes for the Combined Group are set out below.

A.G. Barr All-Employee Share Ownership Plan

The A.G. Barr All-Employee Share Ownership Plan will continue to operate after the Merger becomes Effective and all qualifying employees of the Combined Group will be eligible to participate under that plan.

A.G. Barr Executive Share Option Scheme

The A.G. Barr Executive Share Option Scheme will continue to be available after the Merger becomes Effective and the executive directors and selected senior managers of the Combined Group will be eligible to participate under that scheme, although it is currently expected that no awards will be made under that scheme in 2013.

A.G. Barr Savings Related Share Option Scheme

The A.G. Barr Savings Related Share Option Scheme will continue to operate after the Merger becomes Effective and any future launches under that scheme will be made available to eligible employees (including executive directors) of the Combined Group.

A.G. Barr Long Term Incentive Plan

Subject to the approval of A.G. Barr Shareholders at the A.G. Barr General Meeting, the rules of the A.G. Barr Long Term Incentive Plan will be amended to allow all outstanding awards granted under that plan to vest (subject to the applicable performance conditions being met as at the Effective Date) on a time pro-rated basis on the Effective Date. Awards made in the financial year ended 29 January 2011 will be capable of vesting in full on the Effective Date. Where awards were made in the financial year ended 28 January 2012, two-thirds of those awards will be capable of vesting on the Effective Date. Where awards were made in the financial year ending 26 January 2013, one-third of those awards will be capable of vesting on the Effective Date. This will allow outstanding awards over up to approximately 510,000 A.G. Barr Shares to be capable of vesting (subject to applicable performance conditions being met at the Effective Date).

The proposed Remuneration Committee of the Combined Group believes that the performance conditions attaching to outstanding awards granted under the A.G. Barr Long Term Incentive Plan will no longer be relevant in the context of the Combined Group (and the outstanding awards should vest on the Effective Date in recognition of the Company's performance during the period to the Effective Date). It is proposed that no further awards will be made under the A.G. Barr Long Term Incentive Plan following the Merger becoming Effective (with the A.G. Barr Long Term Incentive Plan to be terminated following the vesting, lapse or forfeiture of the outstanding awards). Subject to the approval of A.G. Barr Shareholders at the A.G. Barr General Meeting, a new long term incentive plan will be established by the Combined Entity for the benefit of selected employees, including executive directors, of the Combined Group (as discussed below).

Britvic Executive Share Option Plan and Britvic Performance Share Plan

All outstanding options granted under the Britvic Executive Share Option Plan and all outstanding awards granted under the Britvic Performance Share Plan will, to the extent not already exercisable or unvested, become exercisable or vest upon the sanction of the Scheme by the Court. The extent to which such options and awards may be exercised or vest will depend upon the extent to which the performance conditions have been satisfied when they become exercisable or vest, and the proportion of any performance period which has elapsed since grant. It is currently expected that the performance conditions will not be satisfied and therefore all options granted under the Britvic Executive Share Option Plan and all awards granted under the Britvic Performance Share Plan will lapse and will not be capable of exercise or vesting upon the sanction of the Scheme by the Court. Options granted under the Britvic Executive Share Option Plan which are already exercisable will continue to be exercisable for six months following the sanction of the Scheme by the Court, after which they will lapse. The Britvic Executive Share Option Plan and the Britvic Performance Share Plan will be terminated following the Merger becoming Effective, but without prejudice to options granted under the Britvic Executive Share Option Plan prior to the termination of that plan.

Britvic Share Incentive Plan

Britvic Shares held on behalf of participants in the Britvic Share Incentive Plan will be exchanged for New A.G. Barr Shares in accordance with the Merger ratio and will continue to be held by the plan trustees on the terms of that plan following the Merger becoming Effective. No further awards will be granted under the Britvic Share Incentive Plan following the Merger becoming Effective and, instead, all GB based employees of the Combined Group will be eligible to participate under the A.G. Barr All-Employee Share Ownership Plan, save that Britvic's existing equivalent arrangements for employees based in Ireland (under which no awards have been granted to date) may, if appropriate, be operated post-Merger using New A.G. Barr Shares.

New A.G. Barr Long Term Incentive Plan

Subject to the approval of A.G. Barr Shareholders at the A.G. Barr General Meeting, a new long term incentive plan will be established by the Combined Entity (the "New LTIP") which will provide for conditional awards and nil-cost/nominal cost options to be granted to selected employees, including executive directors, of the Combined Group. The principal terms of the New LTIP are described in Part IV of this document. It is proposed that awards will be granted under the New LTIP following completion of the Merger, subject to applicable dealing restrictions, as follows:

• (i) selected A.G. Barr and Britvic employees will receive two awards of shares in the Combined Entity, an ordinary course award and a transitional award. For Roger White (as Chief Executive Officer of the Combined Group) and John Gibney (as Chief Financial Officer of the Combined Group), each award will be over shares with a face value of 150 per cent. of his basic salary. For other participants, award levels will be determined, by reference to band, in due course by the Remuneration Committee of the Combined Group;
• (ii) vesting of both awards will be subject to performance conditions (based on a combination of a total shareholder return ("TSR") target (33.33 per cent.) and an earnings per share ("EPS") target (66.67 per cent.)) and continued employment; and

(iii) the ordinary course award will vest three years after the date of grant and the transitional award will vest as to 66.67 per cent. two years after the date of grant and as to 33.33 per cent. one year after the date of grant.

The Scheme will extend to any Britvic Shares that are unconditionally allotted or issued pursuant to the exercise of options or vesting of awards under the Britvic Share Schemes, in each case on or prior to the Scheme Record Time.

14. Irrevocable undertakings

In aggregate, A.G. Barr has received irrevocable undertakings from those of the Britvic Directors and certain members of their families who hold or are beneficially entitled to Britvic Shares to vote in favour of the Scheme in respect of 1,580,021 Britvic Shares and options over 3,805,468 Britvic Shares which, if the options were exercised in full, would represent 5,385,489 Britvic Shares in total, representing, in aggregate, approximately 2.22 per cent. of Britvic's share capital in issue on 3 December 2012.

Those of the Directors, certain members of their families and related trusts who hold or are beneficially entitled to A.G. Barr Shares have given irrevocable undertakings to vote in favour of the Resolutions at the A.G. Barr General Meeting in respect of, in aggregate, 23,281,320 A.G. Barr Shares, representing in aggregate approximately 19.94 per cent. of A.G. Barr's share capital in issue on 3 December 2012.

15. Offer-related arrangements

A.G. Barr and Britvic have entered into a mutual confidentiality agreement dated 24 August 2012 pursuant to which each of A.G. Barr and Britvic has undertaken to keep confidential information relating to the other party and not to disclose it to third parties (other than to permitted disclosees) unless required by law or regulation. These confidentiality obligations will remain in force until completion of the Merger.

A.G. Barr and Britvic have entered into a co-operation agreement dated 14 November 2012 (the "Co-operation Agreement") pursuant to which each of A.G. Barr and Britvic has agreed to use all reasonable endeavours to obtain confirmation from the OFT, as soon as reasonably practicable and in any event before the Long Stop Date, indicating, either unconditionally or subject to the giving of undertakings reasonably satisfactory to A.G. Barr and Britvic, that it does not intend to refer the Merger or any part of it to the Competition Commission. A.G. Barr and Britvic have also agreed to provide each other with such information and assistance as they may reasonably require for the purposes of obtaining all regulatory and other clearances in relation to the Merger, provided that such assistance will not require the Britvic Directors to maintain their recommendation of the Merger or to adjourn or seek to adjourn any shareholder meeting or court hearing in connection with the Scheme or require Britvic or A.G. Barr to make any change to the timetable for implementing the Merger. The Co-operation Agreement also sets out certain agreements reached between A.G. Barr and Britvic in relation to the treatment of the Britvic Share Schemes, certain share schemes operated by A.G. Barr and the continuation of the enhanced early retirement facility currently offered under the Britvic Pension Plan until 6 April 2016. The Co-operation Agreement will terminate if the Scheme (or the Merger Offer if A.G. Barr elects, subject to consent from the Panel and Britvic's written consent, to implement the Merger by way of a contractual takeover offer) is withdrawn or lapses, if the Britvic Directors withdraw their recommendation of the Scheme (or the Merger Offer, as the case may be) or if the Scheme does not become effective in accordance with its terms by the Long Stop Date or otherwise as agreed between A.G. Barr and Britvic.

16. De-listing and re-registration of Britvic

Prior to the Scheme becoming effective, applications will be made to the UK Listing Authority for the cancellation of the listing of Britvic Shares on the Official List and to the London Stock Exchange for the cancellation of trading of Britvic Shares on the London Stock Exchange's main market for listed securities, with effect as of or shortly following the Effective Date.

On the Effective Date, Britvic will become a wholly owned subsidiary of A.G. Barr. It is expected that on or shortly after the Effective Date, Britvic will be re-registered as a private company under the relevant provisions of the Companies Act.

17. Listing, dealings and settlement of the New A.G. Barr Shares

Applications will be made to the UK Listing Authority for the New A.G. Barr Shares to be admitted to the premium listing segment of the Official List and to the London Stock Exchange for the New A.G. Barr Shares to be admitted to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission will become effective and that dealings for normal settlement in the New A.G. Barr Shares will commence on the London Stock Exchange at 8.00 a.m. on 31 January 2013.

18. Dilution

Subject to the Merger becoming Effective, up to 202,000,000 New A.G. Barr Shares will be issued. This will result in A.G. Barr's issued share capital increasing by approximately 173 per cent. If the Merger becomes Effective, A.G. Barr Shareholders will suffer an immediate dilution as a result of the Merger following which they will hold approximately 37 per cent. of the Combined Entity Ordinary Share Capital.

19. Risk factors

For a discussion of certain risk factors which should be taken into account when considering whether or not to vote in favour of the Resolutions, see Part II (Risk Factors).

20. A.G. Barr General Meeting and the Resolutions

As described in paragraph 11 above, completion of the Merger is conditional upon A.G. Barr Shareholders' approval of the Merger Resolution (resolution 1) being obtained at the A.G. Barr General Meeting. Accordingly, you will find set out at the end of this document a notice convening the A.G. Barr General Meeting to be held at the offices of KPMG LLP, 191 West George Street, Glasgow G2 2LJ at 10.00 a.m. London time on Tuesday, 8 January 2013 at which the Resolutions will be proposed to approve the Merger and other matters. The full text of the Resolutions is set out in the notice.

Resolutions 1, 3, 4 and 6 will be proposed as ordinary resolutions. This means that, for each of those resolutions to be passed, more than half of the votes cast must be in favour of the resolution. Resolutions 2, 5, 7 and 8 will be proposed as special resolutions. This means that, for each of those resolutions to be passed, at least three-quarters of the votes cast must be in favour of the resolution.

The implementation of the Merger is conditional upon the passing of resolution 1 only.

Resolution 1 – Approval of the Merger

Resolution 1, which will be proposed as an ordinary resolution, proposes that:

• (a) the Merger be approved and the Directors be authorised to implement the Merger;
• (b) the Directors be authorised to allot the New A.G. Barr Shares in connection with the Merger up to an aggregate nominal amount of £8,416,666.67 (representing, in aggregate, up to 202,000,000 New A.G. Barr Shares); and
• (c) pursuant to article 103 of the A.G. Barr Articles, the Company be permitted to borrow up to £1,250,000,000. Currently, the A.G. Barr Group has the power to borrow up to an amount equal to two times its adjusted capital and reserves (which amounts to approximately £254 million as at 28 January 2012) although borrowings above that amount are permitted if sanctioned in advance by an ordinary resolution of A.G. Barr Shareholders. Following the Merger becoming Effective, the Combined Group will benefit from all of Britvic's existing committed sources of financing, including Britvic's £400 million revolving credit bank facility and its £491 million US private placement notes. Accordingly, resolution 1 seeks shareholder authority to increase the amount that the Company is permitted to borrow under the A.G. Barr Articles to up to £1,250,000,000.

The authority represents approximately 173 per cent. of the total issued ordinary share capital of A.G. Barr as at 3 December 2012. If the resolution is passed, this authority will expire on the later of the conclusion of A.G. Barr's AGM in 2013 and the Long Stop Date and is in addition to any subsisting authorities to allot shares in A.G. Barr. As at 3 December 2012, A.G. Barr held no treasury shares.

Resolution 2 – Change of the Company's name

Resolution 2, which will be proposed as a special resolution, proposes that, subject to the Merger becoming Effective, A.G. Barr's name be changed to "Barr Britvic Soft Drinks plc".

Resolution 3 – Amendment of the rules of the A.G. Barr Long Term Incentive Plan

As explained at paragraph 13 above, it is proposed that no further awards will be made under the A.G. Barr Long Term Incentive Plan following the Merger becoming Effective. In recognition of the Company's performance during the period to the Effective Date, it is proposed that, conditional upon the Merger becoming Effective, all outstanding awards granted under the A.G. Barr Long Term Incentive Plan will vest on a time pro-rated basis (subject to the applicable performance conditions being met at the Effective Date) on the Effective Date.

Resolution 3, which will be proposed as an ordinary resolution, proposes that, subject to the Merger becoming Effective, the rules of the A.G. Barr Long Term Incentive Plan be amended in order to enable such vesting and the Directors (or a duly authorised committee of the Directors) be authorised to do all such acts and things as they consider necessary or desirable to give effect to such vesting.

The full text of the amended rules of the A.G. Barr Long Term Incentive Plan will be available for inspection from the date of publication of this document until Admission and on the date of the A.G. Barr General Meeting at the locations stated in paragraph 8 of Part V (Additional Information).

Resolution 4 – Adoption of new Long Term Incentive Plan

As explained at paragraph 13 above, it is proposed that, conditional upon the Merger becoming Effective, a New LTIP will be established by the Combined Entity which will provide for conditional awards and nil-cost/nominal cost options to be granted to selected employees, including executive directors, of the Combined Group. The proposed Remuneration Committee of the Combined Group believes that the New LTIP will align the interests of the executive directors and participating senior managers with those of shareholders of the Combined Group. The principal terms of the New LTIP are set out in Part IV (Principal Terms of The New LTIP).

Resolution 4, which will be proposed as an ordinary resolution, proposes that, subject to the Merger becoming Effective, the New LTIP be established and the rules of the New LTIP be adopted and the Directors (or a duly authorised committee of the Directors) be authorised to do all such acts and things which they consider necessary or desirable to establish and carry the New LTIP into effect, with such modifications as they may consider necessary or desirable to take account of the requirements of the UK Listing Authority and best practice. Resolution 4 also authorises the Directors to establish one or more other schemes or plans based on the New LTIP for the benefit of employees based overseas but modified to take account of local tax, exchange control or securities laws in overseas territories (with any shares made available under such further schemes or plans counting against any limits on individual or overall participation in the New LTIP). Finally, resolution 4 permits Directors to vote at, and be counted in the quorum of, meetings even though they may have an interest in the New LTIP. However, Directors are not permitted to vote or be counted in the quorum in relation to any matter solely concerning their own participation in the New LTIP.

The rules of the New LTIP will be available for inspection from the date of publication of this document until Admission and on the date of the A.G. Barr General Meeting at the locations stated in paragraph 8 of Part V (Addition Information).

Resolution 5 – Adoption of new articles of association

Currently, the A.G. Barr Group has the power to borrow an amount equal to two times its adjusted capital and reserves (as defined in the A.G. Barr Articles) although borrowings above that amount are permitted if sanctioned in advance by an ordinary resolution of the A.G. Barr Shareholders. Resolution 1 to approve the Merger will sanction an increase in permitted borrowings to an appropriate level taking into account the current borrowings of the Britvic Group. In addition, it is proposed that certain amendments are made to the A.G. Barr Articles in relation to the borrowing powers of the Company conditional upon the Merger becoming Effective.

Resolution 5, which will be proposed as a special resolution, proposes that subject to the Merger becoming Effective, article 103 of the A.G. Barr Articles be amended (by adopting the New A.G. Barr Articles) so as to ensure that the Combined Entity is permitted to borrow the greater of £1,250,000,000 and an amount equal to two times the Combined Entity's adjusted capital and reserves (as defined in that article). In addition, amendments to the borrowing powers article are proposed so that, for the purposes of calculating the total amount of permitted borrowings, borrowings denominated in foreign currencies shall be valued using the rate of exchange used in the most recent audited consolidated balance sheet of the Combined Entity, rather than spot rates, and a three month grace period shall be afforded to the Directors following any inadvertent breach of the borrowing limit.

The New A.G. Barr Articles will not come into effect unless and until the Merger becomes Effective.

The New A.G. Barr Articles will be available for inspection from the date of publication of this document until Admission and on the date of the A.G. Barr General Meeting at the locations stated in paragraph 8 of Part V (Additional Information).

Resolution 6 – Authority to allot shares

The Directors may not allot shares in the Company unless they are authorised to do so by shareholders in general meeting. Resolution 6 will be proposed as an ordinary resolution. The authority in resolution 6, which is subject to the Merger becoming Effective, will allow the Directors to allot new shares in the Company and grant rights to subscribe for, or to convert other securities into, shares in the Company up to an aggregate nominal amount of £4,383,070.70, which is equivalent to approximately 33 per cent. of the expected Combined Entity Ordinary Share Capital (excluding treasury shares).

Resolution 6 will also authorise the Directors to allot new shares and grant rights to subscribe for, or to convert other securities into, shares only in connection with a rights issue up to a further aggregate nominal amount of £4,383,070.70, which is equivalent to approximately 33 per cent. of the expected Combined Entity Ordinary Share Capital (excluding treasury shares).

Resolution 6 is a renewal of the previous authority conferred on the Directors at A.G. Barr's AGM held in 2012, but is without prejudice to the authority conferred on the Directors by resolution 1. The authorities contained in resolution 6 are in line with UK corporate governance guidelines, including the guidance issued by the Association of British Insurers.

The Directors have no present intention to undertake a rights issue or to allot new shares other than in connection with the Merger (see resolution 1 above). The authorities contained in resolution 6 are considered desirable in order to give the Company the maximum flexibility permitted by corporate governance guidelines to respond to market developments and to enable allotments to take place to finance business opportunities if they arise.

If resolution 6 is passed, the authorities will expire on the earlier of the conclusion of A.G. Barr's AGM in 2013 and 31 July 2013.

Resolution 7 – Disapplication of statutory pre-emption rights

If the Directors wish to allot new shares for cash, the Companies Act states that the shares must be offered first to existing shareholders in proportion to their existing holdings. However, for legal, regulatory and practical reasons, it might not be possible or desirable for shares allotted by means of a pre-emptive offer to be offered to certain shareholders, particularly those resident overseas. Furthermore, it might in some circumstances be in the Company's interests for the Directors to be able to allot some shares for cash without having to offer them first to existing shareholders. To enable this to be done, shareholders' statutory pre-emption rights must be disapplied.

Resolution 7 will be proposed as a special resolution. The authority in resolution 7, which is subject to the Merger becoming Effective, will allow the Directors to allot new shares pursuant to the authority given by resolution 6, or sell treasury shares, for cash (a) in connection with a pre-emptive offer or rights issue or (b) otherwise up to an aggregate nominal amount of £664,101.62 equivalent to approximately 5 per cent. of the expected Combined Entity Ordinary Share Capital (excluding treasury shares), in each case without the shares first being offered to existing shareholders in proportion to their existing holdings.

The authority in resolution 7 is a renewal of the previous authority conferred on the Directors at A.G. Barr's AGM held in 2012 and is considered desirable in order to give the Company the flexibility to make small issues of shares for cash if suitable opportunities arise.

The Directors intend to adhere to the provisions in the Pre-emption Group's Statement of Principles not to allot shares for cash on a non-pre-emptive basis (other than pursuant to a rights issue or pre-emptive offer) in excess of an amount equal to 7.5 per cent. of the Combined Entity Ordinary Share Capital (excluding treasury shares) within a rolling three-year period without prior consultation with shareholders.

If resolution 7 is passed, this authority will expire on the earlier of the conclusion of A.G. Barr's AGM in 2013 and 31 July 2013.

Resolution 8 – Purchase of own shares

The Companies Act permits a company to purchase its own shares provided the purchase has been authorised by shareholders in general meeting. Resolution 8 will be proposed as a special resolution. The authority in resolution 8, which is subject to the Merger becoming Effective, will allow the Directors to make market purchases of up to 31,876,877 A.G. Barr Shares, which is equivalent to approximately 10 per cent. of the expected Combined Entity Ordinary Share Capital (excluding treasury shares). A.G. Barr's exercise of this authority is subject to the stated upper and lower limits on the price payable which reflect the requirements of the Listing Rules.

The authority in resolution 8 is a renewal of the previous authority conferred on the Directors at A.G. Barr's AGM held in 2012. The Directors will only exercise this authority after careful consideration, taking into account market conditions prevailing at the time, other investment opportunities, appropriate gearing levels and the overall position of the Company.

The Companies Act permits any shares that are purchased to be held as treasury shares as an alternative to immediately cancelling them. Any purchased ordinary shares held as treasury shares may be sold for cash (all or any of them), be transferred (all or any of them) for the purposes of or pursuant to an employee share plan, be cancelled (all or any of them) or continue to be held as treasury shares. Holding such shares as treasury shares provides the ability to reissue them quickly and cost effectively and provides additional flexibility in the management of the capital base. No dividends will be paid on, and no voting rights will be exercised in respect of, shares held as treasury shares.

As at 3 December 2012, options had been granted over 2,445,992 A.G. Barr Shares, representing approximately 2.1 per cent. of the Company's issued share capital at that date. If the authority to purchase the Company's ordinary shares (pursuant to resolution 8) were exercised in full, those shares under option would represent approximately 2.9 per cent. of the Company's issued share capital as at 3 December 2012. As at 3 December 2012, the Company did not hold any treasury shares.

If resolution 8 is passed, this authority will expire on the earlier of the conclusion of A.G. Barr's AGM in 2013 and 31 July 2013.

21. Action to be taken

A.G. Barr Shareholders will find enclosed a Form of Proxy for use in connection with the A.G. Barr General Meeting and any adjournment thereof. Whether or not you intend to be present at the A.G. Barr General Meeting, you are requested to complete and sign the Form of Proxy in accordance with the instructions printed on it and return it as soon as possible and, in any case, so as to be received by A.G. Barr's Registrars, Equiniti Limited, at their offices at Aspect House, Spencer Road, Lancing BN99 6DA by 10.00 a.m. London time on 6 January 2013 (or, in the case of an adjournment, not later than 48 hours before the time fixed for the holding of the adjourned meeting).

If you hold A.G. Barr Shares in CREST, you may choose to utilise the CREST electronic proxy appointment service in accordance with the procedures set out in the notice convening the A.G. Barr General Meeting at the end of this document. Proxies sent electronically (by the CREST system) must also be sent as soon as possible and, in any event, so as to be received by 10.00 a.m. London time on 6 January 2013 (or, in the case of an adjournment, not later than 48 hours before the time fixed for the holding of the adjourned meeting).

The return of a Form of Proxy (or electronic appointment of a proxy) will not prevent you from attending the meeting and voting in person if you wish.

Participants in the A.G. Barr All-Employee Share Ownership Plan will find enclosed a Form of Direction instead of a Form of Proxy for use in connection with the A.G. Barr General Meeting. The Form of Direction should be returned, duly completed and signed in accordance with the instructions printed on it, to the Registrars at Aspect House, Spencer Road, Lancing BN99 6DA as soon as possible and, in any event, so as to be received not later than 10.00 a.m. on 3 January 2013.

22. Further information

Your attention is drawn to the further information contained in Parts II to V of this document and to the information incorporated by reference into this document as listed in paragraph 2 of Part V (Additional Information).

23. Recommendation

The A.G. Barr Directors, who have been so advised by Rothschild, consider the terms of the Merger to be fair and reasonable. In providing its advice, Rothschild has taken into account the commercial assessments of the A.G. Barr Directors of the Merger. The A.G. Barr Board also considers the Merger and each of the Resolutions to be in the best interests of A.G. Barr Shareholders as a whole and unanimously recommends that A.G. Barr Shareholders vote in favour of each of the Resolutions, as the Directors have irrevocably agreed to do in respect of their own beneficial holdings of 6,189,876 A.G. Barr Shares, representing approximately 5.3 per cent. of A.G. Barr's existing issued ordinary share capital.

Yours faithfully

Ronald G. Hanna

Chairman

PART II

RISK FACTORS

A.G. Barr Shareholders should consider the following risks and uncertainties together with all of the other information set out in this document prior to making any decision as to whether or not to vote in favour of the Resolutions. The risks described below are all of the material risk factors related to the Merger and other matters to be considered in relation to the Merger (the "Proposals"), material new risk factors to the A.G. Barr Group or the Britvic Group as a result of the Proposals, or existing material risk factors to the A.G. Barr Group or the Britvic Group which will be impacted by the Proposals.

The risks described below are based on information known at the date of this document, but may not be the only risks to which the A.G. Barr Group, the Britvic Group or, following the Effective Date, the Combined Group is or might be exposed. Additional risks and uncertainties, which are currently unknown to A.G. Barr or that A.G. Barr does not currently consider to be material, may materially affect the business of the A.G. Barr Group, the Britvic Group and/or the Combined Group and could have material adverse effects on the business, financial condition, results of operations and prospects of the A.G. Barr Group, the Britvic Group and/or the Combined Group. If any of the following risks were to occur, the business, financial condition, results of operations and prospects of the A.G. Barr Group, the Britvic Group and/or the Combined Group could be materially adversely affected and the value of A.G. Barr Shares could decline and shareholders could lose all or part of the value of their investment in A.G. Barr Shares.

A.G. Barr Shareholders should read this document as a whole and not rely solely on the information set out in this section.

RISKS RELATING TO THE MERGER

The completion of the Merger is subject to the satisfaction (or waiver, where applicable) of a number of Conditions

The completion of the Merger is subject to the satisfaction (or waiver, where applicable) of a number of conditions on or before 30 June 2013 or such later date as A.G. Barr and Britvic agree (with, if required, the consent of the Panel and the Court), including:

• approval of the Scheme and related resolutions by Britvic Shareholders at the Britvic Court Meeting and the Britvic General Meeting;
• approval of the Merger by A.G. Barr Shareholders at the A.G. Barr General Meeting;
• the OFT indicating, either unconditionally or subject to the giving of undertakings reasonably satisfactory to A.G. Barr and Britvic, that it does not intend to refer the Merger or any part of it to the Competition Commission;
• sanction of the Scheme and confirmation of the Reduction of Capital by the Court; and
• Admission becoming effective.

There is no guarantee that these (or any other) Conditions will be satisfied (or waived, if applicable). Failure to satisfy any of the Conditions may result in the Merger not being completed.

The A.G. Barr Group will seek antitrust consent from the OFT to complete the Merger which, if delayed, not granted or granted on terms not reasonably satisfactory to A.G. Barr and Britvic, may jeopardise or delay the Merger, result in additional expenditure of money and resources and/or reduce the anticipated benefits of the Merger

The Merger is conditional on, amongst other things, the receipt of antitrust clearance from the OFT. As a condition to its clearance of the Merger, the OFT may accept remedies from A.G. Barr and/or Britvic, such as divestitures. This could jeopardise or delay completion of the Merger or may reduce the anticipated benefits of the Merger. In addition, the Merger will lapse if OFT clearance of the Merger is not obtained by 30 June 2013 or such later date as A.G. Barr and Britvic agree (with, if required, the consent of the Panel and the Court).

Even if a material adverse change to Britvic's business or prospects was to occur, in certain circumstances, A.G. Barr may not be able to invoke the Conditions and terminate the Merger, which could reduce the value of A.G. Barr Shares

Completion of the Merger is subject to a number of Conditions, including that there is no material adverse change affecting Britvic before the Scheme is sanctioned by the Court. Under the City Code, and except for certain antitrust clearance and Scheme-related conditions, A.G. Barr may invoke a condition to the Merger to cause the Merger not to proceed only if the Panel is satisfied that the circumstances giving rise to that condition not being satisfied are of material significance to A.G. Barr in the context of the Merger.

If a material adverse change affecting Britvic were to occur and the Panel did not allow A.G. Barr to invoke a condition to cause the Merger not to proceed, the market price of A.G. Barr Shares or the Combined Group's results of operations, financial condition and/or prospects may be materially adversely affected.

A.G. Barr may fail to realise the business growth opportunities, margin benefits and other synergies anticipated from, or may incur unanticipated costs associated with, the Merger

There is no assurance that the Merger will achieve the business growth opportunities, margin benefits and other synergies A.G. Barr anticipates. A.G. Barr believes that the consideration for the Merger is justified in part by the business growth opportunities, margin benefits and other synergies it expects to achieve by combining its operations with Britvic. However, these expected business growth opportunities, margin benefits and other synergies may not develop and other assumptions upon which A.G. Barr determined the consideration may prove to be incorrect.

A.G. Barr may also face challenges with the following: redeploying resources in different areas of operations to improve efficiency; minimising the diversion of management attention from on-going business concerns; and addressing possible differences between A.G. Barr's business culture, processes, controls, procedures and systems and those of Britvic.

Under any of these circumstances, the business growth opportunities, margin benefits and other synergies anticipated by A.G. Barr to result from the Merger may not be achieved as expected, or at all, or may be delayed materially. To the extent that A.G. Barr incurs higher integration costs or achieves lower margin benefits than expected, its and the Combined Group's results of operations, financial condition, prospects and the price of A.G. Barr Shares may suffer.

The Combined Group's future prospects will, in part, be dependent on its ability to integrate the A.G. Barr Group and the Britvic Group effectively, including the successful integration and motivation of certain A.G. Barr and Britvic key employees and IT and operational systems

The Combined Group's future prospects may, in part, be dependent upon the Combined Group's ability to integrate the A.G. Barr Group and the Britvic Group successfully and any other businesses that it may acquire in the future without material disruption to the existing business including as a result of the integration of IT and operational systems. The performance of the Combined Group in the future will, amongst other things, also depend on the successful integration and motivation of key employees from both the Britvic Group and the A.G. Barr Group. It is possible that failure to retain certain individuals during the integration period will affect the ability to integrate the A.G. Barr Group and the Britvic Group successfully into the Combined Group and could have a material adverse effect on the Combined Group's results of operations, financial conditions and/or prospects.

A.G. Barr Shareholders and Britvic Shareholders will own a smaller percentage of the Combined Group than they currently own of A.G. Barr and Britvic, respectively

After the Merger becomes Effective, A.G. Barr Shareholders and Britvic Shareholders will own a smaller percentage of the Combined Group than they currently own of A.G. Barr and Britvic, respectively. Based on the number of Britvic Shares in issue as at the close of business on 3 December 2012 and assuming that (i) all vested share options under the Britvic Share Schemes are exercised in full and the resulting Britvic Shares are exchanged for New A.G. Barr Shares under the Merger, and (ii) there are no other issues of Britvic Shares or A.G. Barr Shares (including under the A.G. Barr Share Schemes) between 3 December 2012 and the Effective Date, A.G. Barr Shareholders and former Britvic Shareholders will own approximately 37 per cent. and approximately 63 per cent. respectively of the outstanding shares of the Combined Group. As a consequence, the number of voting rights which can be exercised and the influence which may be exerted by shareholders in respect of the Combined Group will be less.

Risks of executing the Merger could cause the market price of A.G. Barr Shares to decline

The market price of A.G. Barr Shares may decline as a result of the Merger, among other reasons, if:

• the integration of Britvic's business is delayed or unsuccessful;
• A.G. Barr does not achieve the expected benefits of the Merger as rapidly or to the extent anticipated by analysts or investors or at all;
• the effect of the Merger on A.G. Barr's financial results is not consistent with the expectations of analysts or investors; or
• A.G. Barr Shareholders or former Britvic Shareholders sell a significant number of A.G. Barr Shares after completion of the Merger.

Pre-emption rights do not apply in relation to the issue of the New A.G. Barr Shares (or where A.G. Barr Shares are otherwise offered for non-cash consideration) resulting in dilution of the ownership rights of A.G. Barr Shareholders

A.G. Barr is not required to make any pre-emptive offer of the New A.G. Barr Shares or of any other A.G. Barr Shares where such shares are being offered for non-cash consideration. The issue of the New A.G. Barr Shares will dilute the ownership rights of A.G. Barr Shareholders. If A.G. Barr does offer A.G. Barr Shares as consideration in making other acquisitions, depending on the number of A.G. Barr Shares offered and the value of such A.G. Barr Shares at the time, the issuance of such A.G. Barr Shares could materially dilute the value of the A.G. Barr Shares held by existing A.G. Barr Shareholders at the time, as the issue of New A.G. Barr Shares for the acquisition will do for A.G. Barr Shareholders.

Admission of the New A.G. Barr Shares may not occur when expected

Application for Admission of the New A.G. Barr Shares will be made close to the Effective Date. If the Effective Date of the Merger is delayed, the application for Admission will be delayed. Admission is subject to the approval (subject to satisfaction of any conditions which such approval is expressed) of the UK Listing Authority and Admission will become effective as soon as a dealing notice has been issued by the UK Listing Authority and the London Stock Exchange has acknowledged that the New A.G. Barr Shares will be admitted to trading. There can be no guarantee that any conditions to which Admission is subject will be met or the UK Listing Authority will issue a dealing notice. See the "Expected Timetable of Principal Events" on page 5 of this document for further information on the expected dates of these events.

EXISTING RISKS RELATING TO THE A.G. BARR GROUP OR THE BRITVIC GROUP WHICH WILL BE IMPACTED BY THE MERGER

The success of the A.G. Barr Group and the Britvic Group depends and, following the Merger becoming Effective, the success of the Combined Group will depend, upon its ability to recruit and retain senior management and other key employees

The success of the A.G. Barr Group and the Britvic Group depends and, following the Merger becoming Effective, the success of the Combined Group will depend, on the efforts, abilities, experience and expertise of the respective senior management teams, and on recruiting, retaining, motivating, effectively communicating with and developing highly skilled and competent people at all levels of their organisations. This includes retaining key A.G. Barr Group and the Britvic Group senior management following the Merger becoming Effective. There can be strong competition for personnel from other companies and organisations and there may, at any time, be shortages in, and the availability of, appropriately skilled people at all levels within the A.G. Barr Group, the Britvic Group and the Combined Group. While the A.G. Barr Group and the Britvic Group have employment or service contracts with their key executives and other personnel, and have in place a long-term incentive plan and share schemes which provide for share grants or awards to incentivise key executives and other personnel, they cannot guarantee the retention of such key executives and personnel. The success of the Combined Group will, amongst other things, also depend upon the successful retention and integration of the A.G. Barr Group's and the Britvic Group's senior management following the Merger becoming Effective. There is a risk that key members of the senior management team of the A.G. Barr Group and the Britvic Group may decide to leave following the Merger, which could have a material adverse effect on the A.G. Barr Group's, the Britvic Group's and the Combined Group's business, results of operations, financial condition, prospects and/or the value of A.G. Barr Shares.

In addition, while both the A.G. Barr Group and the Britvic Group have in place succession planning measures aimed at ensuring the development of its employees to provide successors, over time, for their respective existing executive directors and senior managers, there can be no assurance that these measures will be successful or that, following the Merger becoming Effective, the Combined Group will be able to attract, develop or retain executives of the right calibre.

Employment disputes could have a material adverse effect on A.G. Barr's, Britvic's and, following the Merger becoming Effective, the Combined Group's business, results of operations, financial condition and/ or prospects

Both A.G. Barr and Britvic believe that they have, in general, good relations with their employees and, where applicable, the trade unions that represent those employees. There can, however, be no assurance that, following the Merger becoming Effective, the Combined Group's operations will not be affected by employment disputes or disruptions. There can also be no assurance that work stoppages or other labour-related developments will not adversely affect the financial condition of the Combined Group.

Supply of faulty or contaminated products could have a material adverse effect on A.G. Barr, Britvic and, following the Merger becoming Effective, the Combined Group

A.G. Barr and Britvic have and, following the Merger becoming Effective, the Combined Group intends to have control measures and systems in place to ensure that maximum safety and quality of its products is maintained. The consequences of not being able to do so, due to accidental or malicious ingredient or raw material contamination, or due to supply chain contamination caused by human error or equipment fault or due to manufacturing or design faults, could be severe. Such consequences may include adverse effects on consumer health, loss of market share, financial costs and loss of turnover.

Where there is a product recall as a result of accidental or malicious ingredient or raw material contamination, or due to supply chain contamination caused by human error or equipment fault or due to manufacturing or design faults, a subsequent product relaunch may not successfully return the relevant brand to its previous market position. This could result in a loss of market share and loss of turnover to the Combined Group. Britvic commenced a product recall in July 2012 of its Robinsons Fruit Shoot and Fruit Shoot Hydro products. The effect of that recall is expected to be a modest reduction in the sales of the products for at least the next 12 months. However, the full longer term impact on these products or other products in the Fruit Shoot range is not yet known.

Substantially all of the A.G. Barr Group's, the Britvic Group's and, following the Merger becoming Effective, the Combined Group's sales are generated from sales in the UK, Ireland and France

Together, the majority of the A.G. Barr Group's sales in the financial year ended 28 January 2012 and the Britvic Group's sales in the financial year ended 30 September 2012 were generated in the UK, Ireland and France. Demand for products in the UK, Ireland and France is influenced by a number of factors, including the strength of those economies, the weather, the level of consumer spending, competitive challenges and regulatory changes. Any negative change in economic conditions, weather patterns, the level of consumer spending, competitive challenges or regulatory changes in the UK, Ireland and/or France may, following the Merger becoming Effective, result in a lower growth rate and lower sales by the Combined Group in the UK, Ireland and/or France, which may result in a material adverse effect on the Combined Group's results of operations, financial condition and/or prospects.

Britvic is, and, if the Merger becomes Effective, the Combined Group will be, exposed to a number of risks in connection with the relationship with the Pepsi Group

Britvic is and, following the Merger becoming Effective, the Combined Group will be, a party to the Exclusive Bottling Appointments (relating to GB and Ireland) with the Pepsi Group. Termination or material changes to those arrangements could have a material adverse effect on the revenues, business, results of operations, financial condition and/or prospects of the Combined Group.

Britvic relies, and, if the Merger becomes Effective, the Combined Group will rely on Pepsi Group brands

Britvic has entered into the Exclusive Bottling Appointments with the Pepsi Group. As a result of these arrangements, Britvic currently relies, and, if the Merger becomes Effective, the Combined Group will rely on Pepsi Group brands. Britvic's reputation is, and, if the Merger becomes Effective, the Combined Group's reputation will be, as a supplier of high quality products based, in part, on its relationship with the Pepsi Group and its ability to produce and sell Pepsi Group products. If the Pepsi Group were to suffer reputational damage which impacted on its brands, there could be an adverse effect on the Combined Group's results of operations, financial condition and/or prospects.

Just under half of Britvic's net revenue was generated through sales of Pepsi Group products in Britvic's financial year ended 30 September 2012. As a result, the success of the sale of Pepsi Group products by Britvic and, if the Merger becomes Effective, the Combined Group may affect the willingness of the Pepsi Group to extend or renew the Exclusive Bottling Appointments beyond their scheduled expiry. If the Pepsi Group chose not to extend or renew the Exclusive Bottling Appointments, this could have an adverse effect on Britvic's and, if the Merger becomes Effective, the Combined Group's financial condition and future operations.

The Exclusive Bottling Appointments could be terminated early by the Pepsi Group following a change of control of the Britvic Group or, following the Merger becoming Effective, the Combined Group

On a change of control of Britvic, the Exclusive Bottling Appointments may be terminated by the Pepsi Group under the current terms of the Exclusive Bottling Appointments. The Pepsi Group is supportive of a combination of A.G. Barr and Britvic. Conditional on the Merger becoming Effective, the Pepsi Group and Britvic have agreed certain variations to the contractual terms of the Pepsi Group's exclusive bottling and distribution agreements with Britvic (to reflect the operations of the Combined Group following the Merger) and, on the basis of these revised terms, the Pepsi Group has agreed not to exercise any rights of termination it may have as a consequence of the Merger under these agreements. However, any future change of control of the Combined Group could result in the termination of the Exclusive Bottling Appointments if approval from the Pepsi Group in relation to such change of control is not obtained.

Each Exclusive Bottling Appointment could be terminated early by the Pepsi Group following termination of certain other arrangements between the Pepsi Group and the Britvic Group or, following the Merger becoming Effective, the Combined Group

The termination of any Exclusive Bottling Appointment for any reason in relation to either GB or Ireland gives the Pepsi Group the right to terminate the other Exclusive Bottling Appointments in GB or Ireland, respectively, with immediate effect by written notice to Britvic or, if the Merger becomes Effective, the Combined Group. In addition, the Exclusive Bottling Appointment relating to Pepsi in GB can be terminated by the Pepsi Group with immediate effect by written notice if any other Pepsi Group arrangement is terminated for any reason.

The Exclusive Bottling Appointments may not be renewed following their ultimate expiry

The Exclusive Bottling Appointments (which relate to certain Pepsi and 7UP brands) expire on 31 December 2015 (Ireland) and 31 December 2023 with an automatic extension for additional terms of five years each unless two years' notice of termination has been given by either party (Great Britain), although the Exclusive Bottling Appointments may be terminated earlier by either party giving the requisite notice. Although Britvic, and, if the Merger becomes Effective, the Combined Group would receive notice from the Pepsi Group if it wanted to terminate the Exclusive Bottling Appointments early or, if they did not wish to renew or extend the Exclusive Bottling Appointments beyond their scheduled expiry, their termination could have an adverse effect on Britvic and, if the Merger becomes Effective, the Combined Group's results of operations, financial condition and/or prospects.

Even if the Exclusive Bottling Appointments were renewed on expiration of their respective terms, Britvic and, if the Merger becomes Effective, the Combined Group may not be able to agree new terms with the Pepsi Group which are as favourable to the Combined Group as the terms on which the Exclusive Bottling Appointments were concluded. Any deterioration in the terms on which Britvic, and if the Merger becomes Effective, the Combined Group and the Pepsi Group contract could have an adverse effect on Britvic's and, if the Merger becomes Effective, the Combined Group's development of its relationship with the Pepsi Group and its results of operations, financial condition and/or prospects.

Pension deficit liabilities could unexpectedly increase which may have an adverse impact on the balance sheet and profit and loss of the Combined Group

A.G. Barr operates two pension plans, being the A.G. Barr p.l.c. (2005) Defined Contribution Pension Scheme and the A.G. Barr p.l.c. (2008) Pension and Life Assurance Scheme. The A.G. Barr p.l.c. (2008) Pension and Life Assurance Scheme is a defined benefit scheme based on final salary which also includes a defined contribution section for pension provision to new executive entrants. The assets of both schemes are held separately from those of A.G. Barr and are invested in managed funds. The main section of the defined benefit scheme was closed to new entrants on 5 April 2002 and the executive section closed on 14 August 2003. A.G. Barr also operates unfunded unregistered retirement benefit schemes for three executive Directors which are intended to provide benefits for those individuals where either the annual or lifetime allowance has been exceeded whilst those individuals have been members of the A.G. Barr pension schemes.

As at 28 July 2012 a deficit of £7.1 million was recognised on A.G. Barr's defined benefit plan in accordance with the requirements of IAS 19.

In Great Britain, Britvic operates the Britvic Pension Plan, which has both a defined benefit and a defined contribution section. The Britvic Pension Plan is the largest of Britvic's defined benefit schemes. It was closed to new members in August 2002 and closed to future accrual on 10 April 2011 with members moving into the defined contribution section of the Britvic Pension Plan for future service benefits. Britvic currently operates a discretionary early retirement facility, available to all members of the Britvic Pension Plan, which permits members to retire up to five years early without penalty (allowance for which is made within the funding of the Britvic Pension Plan) although Britvic has given notice to members that this facility will be withdrawn from 6 April 2016. The Britvic Pension Plan is now partially funded by a pension funding partnership (see paragraph 15.2.5 of Part XII (Additional Information) of the accompanying Prospectus for a summary of the Britvic pension funding partnership). Britvic also operates a secured unfunded unregistered retirement benefit scheme called the Britvic Executive Top Up Scheme ("BETUS") which provides additional benefits for certain members of the defined benefit section of the Britvic Pension Plan whose benefits exceed tax approved limits. BETUS closed to future accrual on 10 April 2011 which coincided with the closure to accrual of the defined benefit section of the Britvic Pension Plan.

In Northern Ireland, the Britvic Northern Ireland Pension Plan was closed to new members on 28 February 2006, and since that date new employees have been eligible to join a defined contribution stakeholder plan. The Britvic Northern Ireland Pension Plan is a defined benefit plan and remains open to future accrual for existing members.

In the Republic of Ireland, Britvic employees continued to participate in a number of C&C Group pension funds following the acquisition of the C&C business (in 2007) until being transferred into two newly formed pension plans called the Britvic Ireland Defined Contribution Pension Plan and the Britvic Ireland Defined Benefit Pension Plan on 1 September 2008. Both of these new plans are held under trust and operated by Britvic Ireland Pension Trust Limited as trustee. The Britvic Ireland Defined Benefit Pension Plan is closed to new joiners but remains open to future accrual for existing members. A small number of members of the Britvic Ireland Defined Contribution Pension Plan remain eligible to join the Defined Benefit Pension Plan.

At 30 September 2012, the IAS 19 pension deficit in respect of the Britvic Group defined benefit pension schemes was, in aggregate, £3.7 million.

The nature of the pension arrangements described above means that A.G. Barr and Britvic are, and, following the Merger becoming Effective, the Combined Group will be, exposed to volatile cash, balance sheet and profit and loss impacts. Although the Combined Group expects to be able to meet its obligations under the pension schemes, the funding level of the schemes for both cash and accounting purposes is sensitive to changes in a wide range of actual or assumed factors, which are beyond A.G. Barr's, Britvic's or the Combined Group's control, including primarily investment returns, discount rates for valuing liabilities (driven by returns on bonds), life expectancy, inflation and salary growth. As a result it is not possible to predict accurately the future funding level or employer cash contribution obligations (which are, to a degree, subject to the relevant pension scheme trustees' discretion in respect of any request for further funding) and accounting charges with any degree of certainty. Assets and investments held by A.G. Barr's and Britvic's defined benefit pension schemes may not grow to anticipated levels in the expected time periods. In the case of losses in respect of pension scheme investments, A.G. Barr, Britvic and, following the Merger becoming Effective, the Combined Group may be required to make additional amounts available to make up any prospective pension deficits.

Following the Merger becoming Effective, the amount of the Combined Group's borrowings could adversely affect its results of operations, financial condition and/or prospects

As at 3 December 2012, the A.G. Barr Group had £40 million of facilities available to it consisting of the RBS Facility and the HSBC Facility and an overdraft facility provided by RBS (of which £20 million, in aggregate, had been drawn down and was outstanding). It is expected that on the Merger becoming Effective, the RBS Facility and HSBC Facility will be repaid and the overdraft facility terminated and A.G. Barr will cease to have any obligations in terms of them.

As at 30 September 2012, the Britvic Group had £891 million of committed debt facilities consisting of a £400 million bank facility which matures in 2016 and a series of private placement notes with maturities between 2014 and 2022. The private placement notes are fully drawn. As at 3 December 2012, £28.3 million had been drawn down under the bank facility and was outstanding.

Following the Merger becoming Effective, the existing £400 million bank facility of the Britvic Group will remain in place and A.G. Barr will accede to such bank facility as the parent company of the Combined Group, as a borrower and as a guarantor, and will guarantee the obligations of the Combined Group under such bank facility. Rubicon Drinks Limited, a subsidiary of A.G. Barr, will also accede as a guarantor to the Britvic bank facility. If there is a change of control of Britvic, individual lenders under the bank facility may, if they so require, notify Britvic that their participation in the bank facility be prepaid and their commitment cancelled. The lenders under the bank facility have all waived such rights in connection with the Merger. However, following the Merger becoming Effective, the lenders will have the right to have their participation in the bank facility prepaid and their commitment cancelled if there is a change of control of the Combined Entity if they so require.

Holders of the Britvic Group's private placement notes have the contractual right (exercisable on a holder by holder basis) to require Britvic to repurchase their notes following a change of control of Britvic, subject to satisfaction of certain conditions. The holders have all waived such rights in connection with the Merger. However, following the Merger becoming Effective, the holders of the private placement notes will once again have the contractual right to require Britvic to repurchase their notes following a change of control of the Combined Group, subject to satisfaction of certain conditions. Should such a change of control occur in the future, unless the holders of notes provide a similar waiver of their put rights as they have done in connection with the Merger, the Combined Group may need to secure additional facilities to finance the repurchase of some or all of the notes. However, there can be no guarantee that such facilities will be available on terms commercially acceptable to the Combined Group or at all.

PART III

HISTORICAL FINANCIAL INFORMATION RELATING TO BRITVIC

In this Part III, unless otherwise stated, references to "the company" are references to Britvic, references to "the group" are references to the Britvic Group and references to the "Directors" or the "Board of Directors" are references to the Britvic Directors and the board of directors of Britvic, respectively.

Basis of financial information

The following tables set out audited consolidated financial information of Britvic for the years ended 27 September 2009, 3 October 2010 and 2 October 2011 and unaudited consolidated financial information of Britvic for the year ended 30 September 2012 (as extracted without material adjustment from the Preliminary Results). The financial information for the years ended 27 September 2009, 3 October 2010 and 2 October 2011 set out in this Part III has been extracted without material adjustment from the audited accounts of Britvic for each year. The audit reports of Britvic for each of the financial years ended 27 September 2009, 3 October 2010 and 2 October 2011 were unqualified.

The financial statements of Britvic for the years ended 27 September 2009, 3 October 2010, 2 October 2011 and 30 September 2012 were prepared in accordance with IFRS.

The initial fair value / acquisition accounting for Britvic France was determined provisionally in the financial statements for the 53 weeks ended 3 October 2010. The fair value adjustments were finalised for the purposes of the financial statements for the 52 weeks ended 2 October 2011 in accordance with IFRS 3R. This resulted in an increase to the value of goodwill by £10 million. The comparatives for the 53 weeks ended 3 October 2010 have been adjusted to reflect the updated fair values accordingly.

The A.G. Barr Directors confirm that no material adjustment needs to be made to the financial information for the years ended 27 September 2009, 3 October 2010, 2 October 2011 and 30 September 2012 to achieve consistency with A.G. Barr's accounting policies as the Britvic accounting policies under which this financial information was prepared are to be adopted by A.G. Barr following the Merger becoming Effective.

CONSOLIDATED INCOME STATEMENT

		Audited 52 Weeks Ended 27 September 2009			Audited 53 Weeks Ended 3 October 2010			Audited 52 Weeks Ended 2 October 2011			Unaudited 52 Weeks Ended 30 September 2012
	Note	Before exceptional & other items £m	Exceptional & other items* £m	Total £m	Before exceptional & other items £m	Exceptional & other items* £m	Total £m	Before exceptional & other items £m	Exceptional & other items* £m	Total £m	Before exceptional & other items £m	Exceptional & other items* £m	Total £m
Revenue		978.8	–	978.8	1,138.6	–	1,138.6	1,290.4	–	1,290.4	1,256.4	–	1,256.4
Cost of sales		(450.9)	–	(450.9)	(509.2)	(2.4)	(511.6)	(627.3)	–	(627.3)	(624.6)	–	(624.6)
Gross profit		527.9	–	527.9	629.4	(2.4)	627.0	663.1	–	663.1	631.8	–	631.8
Selling and distribution costs		(294.3)	–	(294.3)	(338.2)	–	(338.2)	(371.4)	–	(371.4)	(353.3)	–	(353.3)
Administration expenses		(123.5)	(20.3)	(143.8)	(156.6)	(134.7)	(291.3)	(156.7)	(23.1)	(179.8)	(165.8)	(4.8)	(170.6)
Operating profit / (loss)	6	110.1	(20.3)	89.8	134.6	(137.1)	(2.5)	135.0	(23.1)	111.9	112.7	(4.8)	107.9
Finance costs	9	(23.6)	–	(23.6)	(25.5)	(0.8)	(26.3)	(29.9)	(2.1)	(32.0)	(28.3)	(2.1)	(30.4)
Profit / (loss) before tax	10	86.5	(20.3)	66.2	109.1	(137.9)	(28.8)	105.1	(25.2)	79.9	84.4	(6.9)	77.5
Taxation		(22.3)	2.9	(19.4)	(29.1)	9.7	(19.4)	(27.2)	5.7	(21.5)	(21.5)	1.4	(20.1)
Profit / (loss) for the period attributable to the equity shareholders		64.2	(17.4)	46.8	80.0	(128.2)	(48.2)	77.9	(19.5)	58.4	62.9	(5.5)	57.4
Earnings per share Basic earnings per share Diluted earnings per share Adjusted basic earnings per share Adjusted diluted earnings per share	11 11 11 11			21.8p 21.2p 33.9p 33.0p			(21.4p) (21.4p) 36.5p 35.5p			24.3p 23.7p 33.7p 32.9p			23.8p 22.4p 27.2p 26.5p

* See note 5.

** Adjusted basic and diluted earnings per share measures have been adjusted by adding back exceptional & other items (see note 5) and amortisation relating to acquired intangible assets (see note 14). This reconciliation is shown in note 11.

All activities relate to continuing operations.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	Note	Audited 52 Weeks Ended 27 September 2009 £m	Audited 53 Weeks Ended 3 October 2010 £m	Audited 52 Weeks Ended 2 October 2011 £m	Unaudited 52 Weeks Ended 30 September 2012 £m
Profit / (loss) for the period attributable to the equity
shareholders		46.8	(48.2)	58.4	57.4
Actuarial gains / (losses) on
defined benefit pension schemes	24	(72.0)	(49.0)	45.1	9.2
Deferred tax on actuarial (gains) /
losses on defined benefit pension schemes		16.9	8.3	(16.7)	(7.9)
Current tax on additional pension
contributions		2.8	2.8	4.3	4.6
Gains in the period in respect of
cash flow hedges	27	33.8	4.5	5.8	(17.0)
Amounts reclassified to the
income statement in respect of
cash flow hedges	27	(34.6)	(3.0)	(3.7)	9.5
Deferred tax in respect of cash
flow hedges accounted for in
the hedging reserve		–	(0.3)	(0.5)	2.1
Exchange differences on
translation of foreign operations	27	17.1	(13.7)	(1.6)	(3.9)
Tax on exchange differences
accounted for in the translation
reserve		–	1.9	1.5	4.0
Other comprehensive income for
the period net of tax		(36.0)	(48.5)	34.2	0.6
Total comprehensive income for
the period attributable to the
equity shareholders		10.8	(96.7)	92.6	58.0

CONSOLIDATED BALANCE SHEET

		Audited 2009	Audited 2010 Restated*	Audited 2011	Unaudited 2012
	Note	£m	£m	£m	£m
Assets
Non-current assets
Property, plant and equipment	13	226.1	247.7	243.8	236.6
Intangible assets	14	293.1	342.5	337.9	305.2
Other receivables	17	2.4	2.3	5.6	3.6
Other financial assets	27	51.9	81.4	93.0	92.1
Deferred tax assets	10f	2.6	6.2	–	–
Pension asset		–	–	–	7.5
		576.1	680.1	680.3	645.0
Current assets
Inventories	18	52.9	83.6	88.5	73.8
Trade and other receivables	19	177.9	228.0	250.0	257.4
Other financial assets	27	1.8	1.0	2.9	0.1
Cash and cash equivalents	20	39.7	54.0	43.0	49.5
		272.3	366.6	384.4	380.8
Non-current assets held for sale	21	5.1	–	0.7	–
Total assets		853.5	1,046.7	1,065.4	1,025.8
Current liabilities
Trade and other payables	25	(291.6)	(348.4)	(370.1)	(357.2)
Bank overdrafts		–	–	–	(1.9)
Interest bearing loans and borrowings		–	–	–	(0.6)
Other financial liabilities	27	(0.4)	(1.4)	(4.3)	(4.4)
Current income tax payable		(11.3)	(17.0)	(15.6)	(7.8)
		(303.3)	(366.8)	(390.0)	(371.9)
Non-current liabilities
Interest bearing loans and borrowings	23	(450.7)	(569.9)	(573.2)	(558.7)
Deferred tax liabilities	10f	(16.9)	(14.3)	(23.0)	(34.1)
Pension liability	24	(85.1)	(118.3)	(45.1)	(11.2)
Other financial liabilities	27	–	(3.9)	(9.7)	(10.9)
Other non-current liabilities	28	–	(4.2)	(1.9)	(1.9)
		(552.7)	(710.6)	(652.9)	(616.8)
Total liabilities		(856.0)	(1,077.4)	(1,042.9)	(988.7)
Net assets / (liabilities)		(2.5)	(30.7)	22.5	37.1
Capital and reserves
Issued share capital	22	43.4	48.0	48.3	48.5
Share premium account		5.0	10.6	15.0	17.7
Own shares reserve		(4.6)	(1.9)	(1.0)	(0.8)
Share scheme reserve		7.3	9.7	7.8	4.2
Hedging reserve		6.2	7.4	9.0	3.6
Translation reserve		34.3	22.5	22.4	22.5
Merger reserve		–	87.3	87.3	87.3
Retained losses		(94.1)	(214.3)	(166.3)	(145.9)
Total equity		(2.5)	(30.7)	22.5	37.1

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010 (see note 15).

CONSOLIDATED STATEMENT OF CASH FLOWS

		Audited 2009	Audited 2010	Audited 2011	Unaudited 2012
	Note	£m	£m	£m	£m
Cash flows from operating activities
Profit / (loss) before tax		66.2	(28.8)	79.9	77.5
Finance costs	9	23.6	26.3	32.0	30.4
Other financial instruments		–	1.5	10.2	(1.4)
Impairment of property, plant and equipment and intangible assets		4.2	116.7	0.5	14.9
Depreciation	13	30.1	32.9	35.6	34.4
Amortisation	14	8.6	9.5	12.9	9.5
Share based payments		6.9	7.8	3.8	3.0
Net pension charge less contributions	24	(13.4)	(16.0)	(27.9)	(31.1)
(Increase) / decrease in inventory		(1.0)	1.3	(4.4)	10.9
(Increase) / decrease in trade and other receivables		(18.9)	10.4	(24.1)	(2.0)
Increase / (decrease) in trade and other payables		41.8	(16.6)	22.8	(2.8)
Loss on disposal of tangible and intangible assets		1.7	1.3	4.6	1.5
Income tax paid		(18.9)	(21.8)	(20.9)	(12.5)
Net cash flows from operating activities		130.9	124.5	125.0	132.3
Cash flows from investing activities
Proceeds from sale of property, plant and equipment		9.5	4.7	0.6	2.2
Purchases of property, plant and equipment		(38.3)	(40.2)	(37.7)	(43.9)
Purchases of intangible assets		(11.9)	(9.8)	(11.9)	(5.4)
Acquisition of subsidiary net of cash acquired	15	–	(151.9)	(4.5)	–
Net cash flows used in investing activities		(40.7)	(197.2)	(53.5)	(47.1)
Cash flows from financing activities
Finance costs		(4.3)	(1.8)	(3.9)	(0.1)
Interest paid		(20.9)	(23.1)	(27.2)	(28.5)
Issue of US\$ notes		–	149.8	113.9	–
Interest bearing loans repaid		(7.3)	(95.0)	(123.4)	(1.0)
Issue of shares		–	93.4	2.3	2.0
Purchase of own shares		(3.3)	(0.9)	(3.3)	(9.3)
Dividends paid to equity shareholders	12	(27.8)	(34.9)	(40.3)	(42.5)
Net cash flows (used) / from financing activities		(63.6)	87.5	(81.9)	(79.4)
Net (decrease) / increase in cash and cash equivalents		26.6	14.8	(10.4)	5.8
Cash and cash equivalents at beginning of period		12.9	39.7	54.0	43.0
Exchange rate differences		0.2	(0.5)	(0.6)	(1.2)
Cash and cash equivalents at the end of the period	20	39.7	54.0	43.0	47.6

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

	Issued share capital £m	Share premium account £m	Own shares reserve £m	Share scheme reserve £m	Hedging reserve £m	Translation reserve £m	Merger reserve £m	Retained losses £m	Total £m
At 28 September 2008 (audited)	43.2	2.5	(7.9)	7.3	7.0	17.2	–	(60.0)	9.3
Total comprehensive income for the
period	–	–	–	–	(0.8)	17.1	–	(5.5)	10.8
Issue of shares	0.2	2.5	(2.6)	–	–	–	–	–	0.1
Own shares purchased for share
schemes	–	–	(3.3)	–	–	–	–	–	(3.3)
Own shares utilised for share schemes Movement in share based schemes	– –	– –	9.2 –	(6.9) 6.9	– –	– –	– –	(2.3) –	– 6.9
Current tax on share based payments	–	–	–	–	–	–	–	0.1	0.1
Deferred tax on share based payments	–	–	–	–	–	–	–	1.4	1.4
Payment of dividend	–	–	–	–	–	–	–	(27.8)	(27.8)
At 27 September 2009 (audited)	43.4	5.0	(4.6)	7.3	6.2	34.3	–	(94.1)	(2.5)
Loss for the period	–	–	–	–	–	–	–	(48.2)	(48.2)
Other comprehensive income	–	–	–	–	1.2	(11.8)	–	(37.9)	(48.5)
	–	–	–	–	1.2	(11.8)	–	(86.1)	(96.7)
Issue of shares Transaction costs relating to placement	4.6	5.6	(4.1)	–	–	–	89.3	–	95.4
of ordinary shares Own shares purchased for share	–	–	–	–	–	–	(2.0)	–	(2.0)
schemes	–	–	(0.9)	–	–	–	–	–	(0.9)
Own shares utilised for share schemes	–	–	7.7	(5.3)	–	–	–	(2.4)	–
Movement in share based schemes	–	–	–	7.7	–	–	–	–	7.7
Current tax on share based payments Deferred tax on share based payments	– –	– –	– –	– –	– –	– –	– –	1.0 2.2	1.0 2.2
Payment of dividend	–	–	–	–	–	–	–	(34.9)	(34.9)
At 3 October 2010 (audited)	48.0	10.6	(1.9)	9.7	7.4	22.5	87.3	(214.3)	(30.7)
Profit for the period	–	–	–	–	–	–	–	58.4	58.4
Other comprehensive income	–	–	–	–	1.6	(0.1)	–	32.7	34.2
	–	–	–	–	1.6	(0.1)	–	91.1	92.6
Issue of shares Own shares purchased for share	0.3	4.4	(4.1)	–	–	–	–	–	0.6
schemes	–	–	(3.3)	–	–	–	–	–	(3.3)
Own shares utilised for share schemes	–	–	8.3	(5.6)	–	–	–	(1.0)	1.7
Movement in share based schemes Current tax on share based payments	– –	– –	– –	3.7 –	– –	– –	– –	– 0.7	3.7 0.7
Deferred tax on share based payments	–	–	–	–	–	–	–	(2.5)	(2.5)
Payment of dividend	–	–	–	–	–	–	–	(40.3)	(40.3)
At 2 October 2011 (audited)	48.3	15.0	(1.0)	7.8	9.0	22.4	87.3	(166.3)	22.5
Profit for the period	–	–	–	–	–	–	–	57.4	57.4
Other comprehensive income	–	–	–	–	(5.4)	0.1	–	5.9	0.6
	–	–	–	–	(5.4)	0.1	–	63.3	58.0
Issue of shares Own shares purchased for share	0.2	2.7	(2.4)	–	–	–	–	–	0.5
schemes	–	–	(9.3)	–	–	–	–	–	(9.3)
Own shares utilised for share schemes	–	–	11.9	(5.6)	–	–	–	(2.0)	4.3
Movement in share based schemes	–	–	–	2.0	–	–	–	–	2.0
Current tax on share based payments Deferred tax on share based payments	– –	– –	– –	– –	– –	– –	– –	0.6 1.0	0.6 1.0
Payment of dividend	–	–	–	–	–	–	–	(42.5)	(42.5)
At 30 September 2012 (unaudited)	48.5	17.7	(0.8)	4.2	3.6	22.5	87.3	(145.9)	37.1

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. General information

Britvic plc (the "company") is a company incorporated in the United Kingdom under the Companies Act 2006. It is a public limited company domiciled in England & Wales and its ordinary shares are traded on the London Stock Exchange. Britvic plc and its subsidiaries (together the "group") operate in the soft drinks manufacturing and distribution industry, principally in the United Kingdom, Republic of Ireland and France.

The operating companies of the group are disclosed within note 32.

2. Statement of compliance

The financial information has been prepared on the basis of applicable International Financial Reporting Standards as adopted by the European Union (IFRS), as they apply to the financial statements of the group.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on a going concern basis. For further detail, please refer to note 33.

The consolidated financial statements have been prepared on a historical cost basis except where measurement of balances at fair value is required as explained below. The consolidated financial statements of the group are presented in pounds sterling, which is also the functional currency of the company, and all values are rounded to the nearest 0.1 million except where otherwise indicated.

Basis of consolidation

The consolidated financial statements of the group incorporate the financial information of the company and the entities controlled by the company (its subsidiaries) in accordance with IAS 27 'Consolidated and Separate Financial Statements'. The financial statements of subsidiaries are prepared for the same reporting period as the company, using consistent accounting policies. All intra-group transactions, balances, income and expenses are eliminated on consolidation. The results of subsidiary undertakings acquired or disposed of in the year are included in the Consolidated Income Statement from the date the group gains control or up to the date control ceases respectively. Control comprises the power to govern the financial and operating policies of the investee so as to obtain benefit from its activities and is achieved through direct or indirect ownership of voting rights; currently exercisable or convertible potential voting rights; or by way of contractual agreement.

While the original acquisition of Britannia Soft Drinks Limited was accounted for under the merger method, in subsequent financial periods the acquisition method of accounting has been used. Under the acquisition method, the assets, liabilities and contingent liabilities of a subsidiary are measured at their fair values at the date of acquisition. Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired is recognised as goodwill. Any deficiency of the cost of acquisition below the fair values of the identifiable net assets acquired (discount on acquisition) is credited to the income statement in the period of acquisition.

Revenue recognition

Revenue is the value of sales, excluding transactions with or between subsidiaries, and after deduction of sales related discounts and rebates, value added tax and other sales related taxes. Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and the amount can be measured reliably.

Sales related discounts are calculated based on the expected amounts necessary to meet claims by the group's customers in respect of these discounts and rebates.

Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Cost comprises the aggregate amount paid and the fair value of any other consideration given to acquire the asset and includes costs directly attributable to making the asset capable of operating as intended. Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value, on a straight-line basis, over the useful economic life of that asset as follows:

Plant and machinery	3 to 20 years
Vehicles (included in plant and machinery)	5 to 7 years
Equipment in retail outlets (included in fixtures, fittings, tools and equipment)	5 to 10 years
Other fixtures and fittings (included in fixtures, fittings, tools and equipment)	3 to 10 years

Land is not depreciated.

Freehold properties are depreciated over 50 years.

Leasehold properties are depreciated over 50 years, or over the unexpired lease term when this is less than 50 years.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Gains and losses on disposals are determined by comparing proceeds with carrying amount, and are included in the income statement in the period of derecognition.

The carrying values of property, plant and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable and are written down immediately to their recoverable amount. Useful lives and residual amounts are reviewed annually and where adjustments are required these are made prospectively.

Goodwill

Business combinations on or after 4 October 2004 have been accounted for under IFRS 3 'Business Combinations' using the acquisition method. On acquisition, the assets, liabilities and contingent liabilities of a subsidiary are measured at their fair values at the date of acquisition. Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired is recognised as goodwill. Any deficiency of the cost of acquisition below the fair values of the identifiable net assets acquired (discount on acquisition) is credited to the income statement in the period of acquisition.

Following initial recognition, goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised.

Goodwill is reviewed for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value may be impaired. As at the acquisition date, any goodwill acquired is allocated to the group of cash-generating units expected to benefit from the combination's synergies by management. Impairment is determined by assessing the recoverable amount of the group of cash-generating units to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised immediately in the income statement.

On disposal of a subsidiary the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

Intangible assets

Trade marks, franchise rights and customer lists

Intangible assets acquired separately are measured on initial recognition at the fair value of consideration paid. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation or impairment losses. An intangible asset acquired as part of a business combination is recognised outside goodwill, at fair value at the date of acquisition, if the asset is separable or arises from contractual or other legal rights and its fair value can be measured reliably.

The useful lives of intangible assets are assessed to be either finite or indefinite. Amortisation is charged on assets with finite lives on a straight-line basis over a period appropriate to the asset's useful life.

The carrying values of intangible assets with finite and indefinite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable.

Intangible assets with indefinite useful lives are also tested for impairment annually either individually or if the intangible asset does not generate cash flows that are largely independent of those from other assets or groups of assets as part of the cash generating unit to which it belongs. Such intangibles are not amortised. The useful life of an intangible asset with an indefinite life is reviewed annually to determine whether indefinite life assessment continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is made on a prospective basis.

Software Costs

Software expenditure is recognised as an intangible asset only after its technical feasibility and commercial viability can be demonstrated. Acquired computer software licences and software developed in-house are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortised over their estimated useful lives of three to seven years.

Impairment of assets

The group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the group makes an estimate of the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects senior management's estimate of the cost of capital. Impairment losses of continuing operations are recognised in the income statement in those expense categories consistent with the function of the impaired asset.

An assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such an indication exists, the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset's recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Goodwill impairment losses cannot subsequently be reversed.

Inventories and work in progress

Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing inventories to their present location and condition. Cost is determined using the weighted average cost method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.

Financial assets

The group determines the classification of its financial assets at initial recognition. When financial assets are recognised initially, they are measured at fair value, which is normally the transaction price, plus directly attributable transaction costs for those financial assets not subsequently measured at fair value through profit or loss. The group assesses at each balance sheet date whether a financial asset or group of financial assets is impaired.

Loans and receivables

The group has financial assets that are classified as loans and receivables. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market, do not qualify as trading assets and have not been designated as either fair value through profit or loss or available for sale. Such assets are carried at amortised cost using the effective interest method if the time value of money is significant. Gains and losses are recognised in the income statement when loans and receivables are derecognised or impaired, as well as through the amortisation process.

Derivative financial instruments and hedging

The group uses derivative financial instruments such as forward currency contracts and interest rate swaps to hedge its risks associated with foreign currency and interest rate fluctuations. All derivative financial instruments are initially recognised and subsequently remeasured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative.

The fair value of forward currency contracts is calculated by reference to current forward exchange rates for contracts with similar maturity profiles. The fair value of interest rate swap contracts is determined by reference to market values for similar instruments.

For those derivatives designated as hedges and for which hedge accounting is appropriate, the hedging relationship is documented at its inception. This documentation identifies the hedging instrument, the hedged item or transaction, the nature of the risk being hedged and how effectiveness will be measured throughout its duration. Such hedges are expected at inception to be highly effective.

Any gains or losses arising from changes in the fair value of derivatives that do not qualify for hedge accounting are taken to the income statement. The treatment of gains and losses arising from revaluing derivatives designated as hedging instruments depends on the nature of the hedging relationship, as follows:

Cash flow hedges

Hedges are classified as cash flow hedges when hedging exposure to variability in cash flows that is either attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction. For cash flow hedges, the effective portion of the gain or loss on the hedging instrument is recognised in other comprehensive income, while the ineffective portion is recognised in the income statement. Amounts previously recognised in other comprehensive income are transferred to the income statement in the period in which the hedged item affects profit or loss, such as when a forecast sale occurs. However, when the forecast transaction results in the recognition of a non-financial asset or liability, the amounts previously recognised in other comprehensive income are included in the initial carrying amount of the asset or liability.

If a forecast transaction is no longer expected to occur, amounts previously recognised in other comprehensive income are transferred to the income statement. If the hedging instrument expires or is sold, terminated or exercised without replacement or rollover, or if its designation as a hedge is revoked, amounts previously recognised in other comprehensive income remain in equity until the forecast transaction occurs and are then transferred to the income statement or included in the initial carrying amount of a non-financial asset or liability as above.

Net investment hedges

Financial instruments are classified as net investment hedges when they hedge the group's net investment in foreign operations. Some of the group's foreign currency borrowings qualify as hedging instruments that hedge foreign currency net investment balances. The effective portion of gains or losses on translation of borrowings designated as net investment hedges is recognised in other comprehensive income. Any ineffective portion is recognised immediately in the income statement. Upon disposal of the associated investment in foreign operations any cumulative gain or loss previously recognised in other comprehensive income is recycled through the income statement.

Fair value hedges

Hedges of the change in fair value of recognised assets or liabilities are classified as fair value hedges. For fair value hedges, the gain or loss on the fair value of the hedging instrument is recognised in the income statement. The gain or loss on the hedged item attributable to the hedged risk adjusts the carrying amount of the hedged item and is also recognised in the income statement. If the hedge relationship no longer meets the criteria for hedge accounting, the hedged item would no longer be adjusted and the cumulative adjustment to its carrying amount would be amortised to the income statement based on a recalculated effective interest rate. The fair value gain or loss on the hedging instrument would continue to be recorded in the income statement.

Derecognition of financial instruments

The derecognition of a financial asset takes place when the contractual rights to the cash flows expire, or when the contractual rights to the cash flows have either been transferred or an obligation has been assumed to pass them through to a third party and the group does not retain substantially all the risks and rewards of the asset.

Financial liabilities are only derecognised when they are extinguished, that is, when the obligation is discharged or cancelled or expires.

Share-based payments

The cost of equity-settled transactions with employees is measured by reference to the fair value at the date at which they are granted. Fair value is determined by an external valuer using an appropriate pricing model. In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the shares ('market conditions').

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award ('vesting date'). The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the number of equity instruments that, in the opinion of the Directors and based on the best available estimate at that date, will ultimately vest (or in the case of an instrument subject to a market condition, be treated as vesting as described below). The income statement charge or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period.

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other performance conditions are satisfied.

Taxation

The current income tax expense is based on taxable profits for the period, after any adjustments in respect of prior periods. It is calculated using taxation rates enacted or substantively enacted by the balance sheet date and is measured at the amount expected to be recovered from or paid to the taxation authorities.

Provision is made for deferred tax liabilities, or credit taken for deferred tax assets, on all material temporary differences between the tax base of assets and liabilities and their carrying values in the consolidated financial statements.

The principal temporary differences arise from accelerated capital allowances, provisions for pensions and other post-retirement benefits, provisions for share-based payments, employee profit share schemes and utilised losses incurred in overseas jurisdictions.

Deferred tax assets are recognised to the extent that it is regarded as probable that future taxable profits will be available against which the temporary differences can be utilised.

Deferred tax is calculated at the tax rates that are expected to apply in the periods in which the asset or liability will be settled based on the tax rates enacted or substantively enacted by the balance sheet date.

Pensions and post retirement benefits

The group operates a number of pension schemes. These include both defined benefit and defined contribution plans.

Defined benefit plans

The defined benefit pension liability or asset in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation less any past service cost not yet recognised and less the fair value of plan assets out of which the obligations are to be settled directly. Plan assets are measured at fair value based on market price information and in the case of quoted securities, the published bid price. Plan liabilities are measured on an actuarial basis, using the projected unit credit method and discounted at an interest rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the plan liabilities.

The movement in the defined benefit pension asset or liability in the balance sheet consists of four main elements.

• The service cost of providing pension benefits to employees for the period which is recognised in the income statement.

• A charge representing the unwinding of the discount on the plan liabilities during the year which is included within administrative expenses.
• A credit representing the expected return on the plan assets during the year which is included within administrative expenses. This credit is based on the market value of the plan assets, and expected rates of return, at the beginning of the period.
• Actuarial gains and losses. These may result from: differences between the expected return and the actual return on plan assets; differences between the actuarial assumptions underlying the plan liabilities and actual experience during the year; or changes in the actuarial assumptions used in the valuation of the plan liabilities. Actuarial gains and losses, and taxation thereon, are recognised immediately in other comprehensive income.
• Any net pension assets arising are assessed for restrictions.

Changes to benefits under a defined benefit plan are accounted for as follows:

• Past service cost is the increase in the present value of the defined benefit obligation for employee service in prior periods, resulting from changes to post-employment benefits. Past service costs are recognised in profit or loss on a straight-line basis over the vesting period or immediately if the benefits have vested.
• When a settlement (eliminating all obligations for part or all of the benefits already accrued) or a curtailment (reducing future obligations as a result of a material reduction in the scheme membership or a reduction in future entitlement) occurs the obligation and related plan assets are re-measured using current actuarial assumptions and the resultant gain or loss is recognised in the income statement during the period in which the settlement or curtailment occurs.

Defined contribution plans

Under defined contribution plans, contributions payable for the period are charged to the income statement as an operating expense.

Employee benefits

Wages, salaries, bonuses and paid annual leave are accrued in the period in which the associated services are rendered by the employees of the group.

Leases

Leases in which substantially all the risks and rewards of ownership of the leased asset are retained by the lessor are classified as operating leases by the group. Leases in which the group assumes substantially all the risks and rewards of ownership are classified as finance leases.

Rentals payable under operating leases are charged to income on a straight-line basis over the term of the relevant lease. Any lease incentives received are credited to the income statement on a straight-line basis over the term of the leases to which they relate.

Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits held at call with banks and other short-term highly liquid investments with original maturities of three months or less, which are readily convertible into known amounts of cash and subject to insignificant risk of changes in value. For the purposes of the statement of cash flows, bank overdrafts repayable on demand are a component of cash and cash equivalents.

Trade and other receivables

Trade receivables, which generally have 30-90 day terms, are recognised at the lower of their original invoiced value and recoverable amount.

Provision is made when collection of the full amount is no longer considered probable. Balances are written off when the probability of recovery is assessed as being remote.

Interest bearing loans and borrowings

Interest bearing loans and borrowings are initially recognised in the balance sheet at fair value less directly attributable transaction costs and are subsequently measured at amortised cost using the effective interest rate method.

Gains and losses arising on the repurchase, settlement or otherwise cancellation of liabilities are recognised respectively in finance income and finance cost.

Foreign currencies

Functional and presentation currency

The consolidated financial statements of the group are presented in pounds sterling. The presentation currency of the consolidated financial statements is the same as the functional currency of the company.

Transactions and balances

Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. All differences are taken to the income statement except when hedge accounting is applied and for differences in monetary assets and liabilities that form part of the Group's net investment in a foreign operation. These are recognised in other comprehensive income until the disposal of the net investment, at which time they are recognised in profit and loss.

Foreign operations

The income statement and statement of cash flows of foreign operations are translated at the average rate of exchange during the period. The balance sheet is translated at the rate ruling at the reporting date. Exchange differences arising on opening net assets and arising on the translation of results at an average rate compared to a closing rate are both recognised in other comprehensive income. On disposal of a foreign operation, the accumulated exchange differences previously recognised in other comprehensive income are included in the consolidated income statement.

Segmental reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the board of directors of the company.

Issued share capital

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Nature and purpose of other reserves

Share premium account

The share premium account is used to record the excess of proceeds over the nominal value on the issue of shares.

Own shares reserve

The own shares reserve is used to record purchases by the group of its own shares, which will be distributed to employees as and when share awards made under the Britvic employee share plans vest.

Share scheme reserve

The share scheme reserve is used to record the movements in equity corresponding to the cost recognised in respect of equity-settled share based payment transactions. Amounts recognised in the share scheme reserve are transferred to retained losses upon subsequent settlement of any awards that vest either by issue or purchase of the group's shares, or when awards lapse.

Hedging reserve

The hedging reserve records the effective portion of movements in the fair value of forward exchange contracts, interest rate and cross currency swaps that have been designated as hedging instruments in cash flow hedges.

Translation reserve

The translation reserve includes cumulative net exchange differences on translation into the presentational currency (sterling) of items recorded in group entities with a non-sterling functional currency net of amounts recognised in respect of net investment hedges.

Merger reserve

The movement on the merger reserve during the period ended 3 October 2010 was the result of the non pre-emptive share placement which took place on 21 May 2010. It was executed using a structure which created a merger reserve under Section 612-3 of the Companies Act 2006.

Own shares

The cost of own shares held in employee share trusts and in treasury is deducted from shareholders' equity until the shares are cancelled, reissued or disposed. Where such shares are subsequently sold or reissued, the fair value of any consideration received is also included in shareholders' equity.

Exceptional and other items

The group presents items as exceptional and other items on the face of the income statement to allow shareholders to understand better the elements of financial performance in the year, so as to facilitate comparison with prior periods and to assess trends in financial performance more readily.

• 'Exceptional' items include those significant items of income and expense which, because of the nature and infrequency of the events giving rise to them, merit separate presentation.
• 'Other' items include fair value movements on financial instruments where hedge accounting cannot be applied. These items have been included within 'exceptional and other items' because they are non-cash and do not form part of how management assesses performance.

Key judgements and sources of estimation uncertainty

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that the actual outcomes could differ from those estimates. In the process of applying the group's accounting policies, management has made the following judgements which have the most significant effect on the amounts recognised in the financial statements.

Post retirement benefits

The determination of the pension and other post retirement benefits cost and obligation is based on assumptions determined with independent actuarial advice. The assumptions include discount rate, inflation, pension and salary increases, expected return on scheme assets, mortality and other demographic assumptions. These key assumptions are disclosed in note 24.

Impairment of goodwill and intangible assets with indefinite lives

Determining whether goodwill and intangible assets with indefinite lives are impaired requires an estimation of the value in use of the cash generating units to which the goodwill / intangible asset has been allocated. The value in use calculation requires an estimate of the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Further details are given in note 16.

Deferred tax

Deferred tax assets and liabilities require management's judgement in determining the amounts to be recognised. In particular, significant judgement is used when assessing the extent to which deferred tax assets should be recognised which is dependent on the generation of sufficient future taxable profits. The group recognises deferred tax assets to the extent it is probable that the benefit will be realised. Further details are given in note 10.

Cross currency interest rate swaps

The group measures cross currency interest rate swaps at fair value at each balance sheet date. The fair value represents the net present value of the difference between the projected cash flows at the swap contract rate and the relevant exchange/interest rate for the period from the balance sheet date to the contracted expiry date. The calculation therefore uses estimates of present value, future foreign exchange rates and interest rates. Information regarding cross currency interest rate swaps is provided in notes 23 and 27.

Other

The group also makes estimations and judgements in the valuation of share-based payments. However, the value of this item is such that any variation in the estimates used is unlikely to have a significant effect on the amounts recognised in the financial statements. Further details are given in note 29.

New standards adopted in the current period

During the period, the group adopted a number of interpretations and amendments to standards which had an immaterial impact on the consolidated financial statements of the group.

New standards and interpretations not applied

The group has not applied the following IFRSs, which may be applicable to the group, that have been issued but are not yet effective:

		Effective date – periods commencing on or after
	International Financial Reporting Standards (IFRS)
IFRS 7	Amendment to IFRS 7 – Offsetting of assets and liabilities	1 January 2013
IFRS 9	Financial Instruments – Classification and measurement	1 January 2013
IFRS 10	Consolidated financial statements	1 January 2013
IFRS 11	Joint arrangements	1 January 2013
IFRS 12	Disclosures of interests in other entities	1 January 2013
IFRS 13	Fair value measurement	1 January 2013
International Accounting Standards (IAS)
IAS 1	Amendment to IAS 1 – Presentation of financial statements	1 July 2012
IAS 12	Amendment to IAS 12 – Income taxes	1 January 2012
IAS 19	IAS 19 (revised 2011) – Employee benefits	1 January 2013
IAS 27	IAS 27 (revised 2011) – Separate financial statements	1 January 2013
IAS 32	Amendment to IAS 32 – Offsetting of assets and liabilities	1 January 2014
Other
Annual improvements	Annual improvements 2011	1 January 2013

The Directors do not anticipate that the adoption of these standards will have a material impact on the group's reported income or net assets in the period, with the exception of IAS 19 revised which is not anticipated to have a material impact on net assets, but the impact on the reported income of the group is not possible to determine as it will depend on conditions at the time of adoption.

The most significant change for Britvic under IAS 19 revised is the replacement of interest cost and expected return on plan assets with a finance cost component which is determined by applying the same discount rate used to measure the defined benefit obligation to the net defined benefit liability or asset. The difference between the actual return on plan assets and the discount rate will be presented in other comprehensive income. The effect at the date of adoption will depend on market interest rates, rates of return and the actual mix of scheme assets at that time. The directors consider that this change will not have a material impact on the Group consolidated results. Following consultation with GB employees, the group principal pension scheme, the Britvic Pension Plan (BPP), was closed to future accrual for active members with effect from 10 April 2011 and the intention of the Trustees is to change the asset allocation over time to reduce the risk of volatility within the asset portfolio. Changes to the mix of scheme assets to reduce risk may also reduce the impact of IAS 19 revised.

4. Segmental reporting

For management purposes, the group is organised into business units and has five reportable segments as follows:

• GB Stills United Kingdom excluding Northern Ireland
• GB Carbs United Kingdom excluding Northern Ireland
• International
• Ireland
• France

These business units sell soft drinks into their respective markets.

Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on brand contribution. This is defined as revenue less material costs and all other marginal costs that management considers to be directly attributable to the sale of a given product. Such costs include brand specific advertising and promotion costs, raw materials and marginal production and distribution costs. However, group financing (including finance costs) and income taxes are managed on a group basis and are not allocated to reportable segments.

Transfer prices between reportable segments are on an arm's length basis in a manner similar to transactions with third parties.

52 weeks ended 30 September 2012	GB Stills £m	GB Carbs £m	International £m	Total GB & International £m	Ireland £m	France £m	Adjustments £m	Total £m
Revenue
– External	321.7	517.9	29.3	868.9	138.7	248.8	–	1,256.4
– Inter-segment***	15.0	9.6	–	24.6	8.0	0.8	(33.4)	–
	336.7	527.5	29.3	893.5	146.7	249.6	(33.4)	1,256.4
Brand contribution	141.2	188.7	8.3	338.2	44.6	59.2	–	442.0
Non-brand advertising & promotion *								(7.8)
Fixed supply chain**								(100.3)
Selling costs**								(118.0)
Overheads and other costs*								(103.2)
Operating profit before exceptional & other items								112.7
Finance costs before
exceptional & other items								(28.3)
Exceptional & other items								(6.9)
Profit before tax								77.5
52 weeks ended 2 October 2011	GB Stills £m	GB Carbs £m	International £m	Total GB & International £m	Ireland £m	France £m	Adjustments £m	Total £m
Revenue
– External	351.2	502.6	29.1	882.9	162.8	244.7	–	1,290.4
– Inter-segment***	13.8	10.1	–	23.9	8.4	0.6	(32.9)	–
	365.0	512.7	29.1	906.8	171.2	245.3	(32.9)	1,290.4
Brand contribution	150.1	189.1	10.9	350.1	57.8	62.0	–	469.9
Non-brand advertising & promotion *								(8.0)
Fixed supply chain**								(111.1)
Selling costs**								(121.7)
Overheads and other costs*								(94.1)
Operating profit before exceptional & other items								135.0
Finance costs before
exceptional & other items								(29.9)
Exceptional & other items								(25.2)
Profit before tax								79.9

				Total GB &
53 weeks ended 3 October	GB Stills	GB Carbs	International	International	Ireland	France	Adjustments	Total
2010	£m	£m	£m	£m	£m	£m	£m	£m
Revenue
– External	369.2	477.6	27.6	874.4	179.0	85.2	–	1,138.6
– Inter-segment***	12.2	8.2	–	20.4	5.6	–	(26.0)	–
	381.4	485.8	27.6	894.8	184.6	85.2	(26.0)	1,138.6
Brand contribution	172.5	187.1	9.9	369.5	64.1	24.1	–	457.7
Non-brand advertising & promotion *								(10.4)
Fixed supply chain**								(94.9)
Selling costs**								(117.2)
Overheads and other costs*								(100.6)
Operating profit before
exceptional & other
items								134.6
Finance costs before
exceptional & other items								(25.5)
Exceptional & other items								(137.9)
Loss before tax								(28.8)

* Included within 'Administration expenses' in the Consolidated Income Statement. Costs included within 'Overheads and other costs' relate to central costs including salaries, IT maintenance, depreciation and amortisation.

** Included within 'Selling and distribution costs' in the Consolidated Income Statement

*** Inter-segment revenues are eliminated on consolidation

Geographic information

Revenues from external customers

The analysis below is based on the location where the sale originated.

	2010 £m	2011 £m	2012 £m
United Kingdom	899.9	913.4	900.4
Other	238.7	377.0	356.0
Total revenue	1,138.6	1,290.4	1,256.4

Non-current assets

	2010 Restated* £m	2011 £m	2012 £m
United Kingdom (includes Northern Ireland)	260.1	262.6	260.1
Republic of Ireland	131.5	128.7	104.8
France	200.9	196.0	181.3
Total	592.5	587.3	546.2

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

Non-current assets for this purpose consist of property, plant and equipment, intangible assets and other receivables.

Segmental reporting 2009

The Directors consider that the group's primary reporting segment is geographical, as this is the basis on which the group is organised and managed. The geographical segments are: United Kingdom excluding Northern Ireland ('GB') and Republic of Ireland & Northern Ireland ('ROI & NI'). Britvic International is included within the GB segment.

	GB £m	ROI & NI £m	2009 TOTAL £m
Gross revenue	793.5	190.6	984.1
Inter-segment revenue*	(4.2)	(1.1)	(5.3)
Segment revenue	789.3	189.5	978.8
Segment result
Gross profit	450.2	77.7	527.9
Operating profit before exceptional items	99.0	11.1	110.1
Operating profit after exceptional items	93.6	(3.8)	89.8
Other non-cash expenses
Depreciation of property, plant and equipment	26.2	3.9	30.1
Amortisation of intangible assets	6.9	1.7	8.6
Impairment of property, plant and equipment	–	4.2	4.2
Share-based payments	7.7	–	7.7
Segment assets
Gross assets	516.6	624.9	1,141.5
Inter-segment assets	(18.1)	(312.2)	(330.3)
Unallocated assets			42.3
Total segment assets			853.5
Segment liabilities
Gross liabilities	604.8	102.5	707.3
Inter-segment liabilities	(312.2)	(18.1)	(330.3)
Unallocated liabilities			479.0
Total segment liabilities			856.0
Capital expenditure
Capital expenditure	39.3	7.1	46.4

* Inter-segment transactions are performed using arm's length prices.

5. Exceptional and other items

		2010 £m	2011 £m	2012 £m
Net pension gain*	(a)	–	13.2	21.1
Asset impairments*	(b)	(116.1)	–	(14.9)
Advisory fees		–	–	(3.1)
Costs in relation to the purchase of Britvic France*	(c)	(8.5)	–	–
Acquisition (merger costs)	(d)	–	–	–
Restructuring costs*	(e)	(5.7)	(25.0)	(7.9)
Head office relocation*	(f)	–	(1.3)	(1.5)
Onerous leases*	(g)	(3.1)	–	0.2
Write off of unamortised financing fees**	(h)	–	(1.5)	–
Other fair value movements***	(i)	(4.5)	(10.6)	(0.8)
Total exceptional and other items before tax		(137.9)	(25.2)	(6.9)

* Included within administration expenses in the consolidated income statement

** Included within finance costs in the consolidated income statement

*** For 2012, £nil (2011: nil, 2010: £2.4m) included with cost of sales, £1.3m (2011: £10.0m, 2010: £1.3m) within administration expenses and £2.1m (2011: £0.6m, 2010: £0.8m) included within finance costs in the consolidated income statement.

a) For 2012 this includes an Ireland pension past service gain of £21.3m recognised under IAS19 Employee Benefits. This arises from the removal of the guaranteed pension indexation. For 2011 this includes a pension curtailment gain of £17.7m arising due to the closure to future accrual of the defined benefit section of the Britvic Pension Plan. Offsetting the gain is a one off transitional payment of 10% of final salary to pension members of £2.9m and consultancy costs of £1.6m.

b) In 2012, the asset impairments relate to the impairment of SAP implementation costs in Ireland. The original benefits have reduced against a backdrop of market decline in Ireland and the economic value is no longer consistent with the future value to be generated. In 2010, asset impairments can be analysed as follows:

• Impairments of goodwill in the GB segment (Red Devil £5.0m, Orchid £6.4m).
• Impairments of intangible assets in the Ireland segment (£89.6m).
• Impairments of land and buildings in the Ireland segment (£14.6m, £0.5m relates to assets previously held for sale).
• Impairments of plant and equipment in the GB segment (£0.5m).

In respect of tangible fixed assets, all impairments were calculated based on fair value less costs to sell, where the fair value is determined by reference to an active market.

c) In 2010, costs relating to the purchase and integration of Britvic France were primarily Advisors' fees.

d) This relates to advisory fees for a potential acquisition that was not progressed and the potential merger of Britvic plc and A.G. Barr plc.

e) Restructuring costs includes the costs of major restructuring programmes undertaken.

The 2012 costs principally relate to:

• Redundancy costs arising in the Ireland segment;
• Redundancy and restructuring costs relating to the final elements of the separation of support structures between group and GB; and
• Costs relating to the outsourcing of the customer operations technical service.

The 2011 costs principally relate to:

• Redundancy costs arising in the Ireland segment;
• Redundancy and restructuring costs relating to the separation of functional support structures between group and the GB business unit;
• Costs relating to the outsourcing of the group data centre involving dual running and temporary infrastructure cost; and
• The outsourcing of our GB full service vending operation. This includes exit and redundancy costs and a write down of the associated assets.

The 2010 costs related to:

• Redundancy costs arising in the Ireland segment; and
• Costs in relation to the Business Transformation project in the Ireland segment.

f) Head office relocation relates to costs associated with the transfer of the Britvic head office from Chelmsford to Hemel Hempstead which is proposed to take place in 2012. The 2011 cost principally relates to a dilapidations provision and lease break fee in respect of the existing office in Chelmsford.

g) In 2012, there is a credit against the onerous lease provision relating to rental received from a sublet in the year. In 2010, the onerous leases related to two sites within the Ireland business segment where, in addition to accruals made in previous years, incremental future lease commitments were accrued for based on our experience of the deterioration in the Irish property market during 2009/10.

h) Following the successful refinancing of the group's committed bank facility in March 2011 (see note 23), the unamortised 2009 refinancing fees of £1.5m have been written off to finance costs in the consolidated income statement.

i) Other fair value movements relate to the fair value movement of derivative financial instruments where hedge accounting cannot be applied.

Details of the tax implications of exceptional items are given in note 10a.

Exceptional Items 2009

		2009 £m
Cost of incentive schemes directly associated with the flotation	(a)	(0.8)
Restructuring costs	(b)	(16.6)
Costs in relation to the purchase of Britvic Ireland	(c)	(0.5)
Onerous leases	(d)	(2.4)
Returnable bottle line closure and associated costs	(e)	–
IT equipment impairment	(f)	–
		(20.3)

a) Cost of incentive schemes directly associated with the flotation include all-employee share schemes and management incentives. The cost relates to a transitional award granted to members of both the senior leadership team and senior management team shortly after flotation, the purpose of which was to compensate these individuals for the loss of existing long-term incentive bonuses which were discontinued upon flotation.

b) Restructuring costs includes the costs of major restructuring programmes undertaken. In the current year these are principally:

• Redundancy costs arising in both the GB and Ireland segments;
• Other costs associated with delivering the synergies within the Ireland segment; and
• Impairments of property, plant and equipment relating to the closure of three sites in the Britvic Ireland business. Impairments amount to £4.2m.

c) Costs in relation to the purchase of Britvic Ireland relate to the costs incurred in acquiring the business which cannot be included in the cost of the business combination and therefore cannot be capitalised. In the current year costs relate to professional fees incurred in respect of establishing new pension schemes in the Britvic Ireland business. The 2008 number principally relates to compensation paid to a distributor formerly used in Ireland prior to the acquisition of Britvic Ireland.

d) The onerous leases relate to two sites within the business where future lease commitments have been accrued for. These are the closure of depot space as a result of the project to deliver the synergies in the Ireland segment and the rationalisation of office space in the GB segment.

e) Returnable bottle line closure and associated costs in the prior year related primarily to a write-down of inventories for returnable glass bottle stocks which became redundant due to the move to non-returnable bottles in the GB segment.

f) The IT equipment impairment in the prior year related to the write down of servers which have now been replaced to accommodate increased business requirements following the acquisition of Britvic Ireland.

Details of the tax implications of exceptional items are given in note 10a.

All impairments have been calculated based on fair value less costs to sell, where the fair value is determined by reference to an active market.

6. Operating profit / (loss)

This is stated after charging:

	2009 £m	2010 £m	2011 £m	2012 £m
Cost of inventories recognised as an expense	450.9	509.2	627.3	624.6
Write-down of inventories to net realisable value*	2.6	2.9	2.3	3.6
Research and development expenditure written off	1.5	1.7	0.6	0.6
Net foreign currency differences	3.4	4.0	(0.1)	2.4
Depreciation of property, plant and equipment	30.1	32.9	35.6	34.4
Amortisation of intangible assets	8.6	9.5	12.9	9.5
Operating lease payments – minimum lease payments	16.3	14.9	16.6	21.4

* In 2009, This excludes the write-down of returnable bottle stocks included in Note 5.

7. Auditors' remuneration

2012

Audit of the group financial statements	2012 £m 0.2
Audit of subsidiaries	0.4
Total audit	0.6
Audit related assurance services
Other assurance services
All taxation advisory services	0.2
Corporate finance services (excluding amounts included above in tax advisory and other assurance services)	1.2
Other non-audit services not covered above	1.3
Total non-audit services	2.7
Total fees	3.3

2009, 2010, and 2011

	2009 £m	2010 £m	2011 £m
Auditors' remuneration – audit of the group financial statements	0.3	0.4	0.3
Other fees to auditors
– local statutory audits for subsidiaries	0.1	0.1	0.1
– Other services	–	0.2	0.6

In 2011, fees in the other services category comprise £0.1m for tax services, £0.1m for corporate finance services and £0.4m for other services. The fees in the other services category in the prior period comprise £0.15m of audit related fees and £0.05m of tax related fees.

8. Staff costs

	2009 £m	2010 £m	2011 £m	2012 £m
Wages and salaries*	126.8	123.9	147.3	125.4
Social security costs	11.2	14.1	19.8	19.0
Pension costs (note 24)	9.5	12.3	(6.4)**	(7.3)
Expense of share based compensation (note 29)	7.7***	9.4	4.7	3.0
	155.2	159.7	165.4	140.1

* £6.4m (2011: £13.3m, 2010: £2.6m, 2009: £8.8m) of this is included within 'restructuring costs' in exceptional and other items (note 5).

** 2012 pension income includes a past service gain of £21.3m in relation to changes in the Ireland defined benefit pension plan which is in exceptional and other items (note 5). 2011 pension income included curtailment gain of £17.7m arising in relation to the Britvic Pension Plan which is in exceptional and other items (note 5).

*** £0.8m of this is included within exceptional items (note 5)

Directors' emoluments which are included above are detailed in the Directors' Remuneration Report. The average monthly number of employees during the period was made up as follows:

	2009	2010	2011	2012
Distribution	525	395	407	370
Production	1,107	1,244	1,516	1,465
Sales and marketing	899	983	1,114	1,038
Administration	505	435	495	464
	3,036	3,057	3,532	3,337

9. Finance costs

	2009 £m	2010 £m	2011 £m	2012 £m
Bank loans, overdrafts and loan notes	(23.6)	25.5	31.4	28.3
Fair value movement on interest rate swap (see note 27)		0.8	0.6	2.1
Total finance costs	(23.6)	26.3	32.0	30.4

10. Taxation

a) Tax on loss on ordinary activities

	2012
	Before exceptional & other items £m	Exceptional & other items £m	Total £m
Income statement
Current income tax Current income tax (charge) / credit	(13.0)	3.2	(9.8)
Amounts overprovided / (underprovided) in previous years	(2.1)	(0.3)	(2.4)
Total current income tax (charge) / credit	(15.1)	2.9	(12.2)
Deferred income tax Origination and reversal of temporary differences Amounts (underprovided) / overprovided in previous years	(6.8) 0.4	(1.5) –	(8.3) 0.4
Total deferred tax credit	(6.4)	(1.5)	(7.9)
Total tax (charge) / credit in the income statement	(21.5)	1.4	(20.1)
Statement of comprehensive income Current tax on additional pension contributions Deferred tax on actuarial losses on defined benefit pension schemes Deferred tax in respect of cash flow hedges accounted for in the hedging reserve Tax on exchange differences accounted for in the translation reserve			4.6 (7.9) 2.1 4.0
Total tax charge in the statement of comprehensive income			2.8
Statement of changes in equity Current tax on share options exercised Deferred tax on share options granted to employees			0.6 1.0
Total tax credit in the statement of changes in equity			1.6

	2011
	Before exceptional & other items £m	Exceptional & other items £m	Total £m
Income statement
Current income tax
Current income tax (charge) / credit	(31.3)	4.3	(27.0)
Amounts overprovided / (underprovided) in previous years	1.1	(0.3)	0.8
Total current income tax (charge) / credit	(30.2)	4.0	(26.2)
Deferred income tax
Origination and reversal of temporary differences	3.3	1.5	4.8
Amounts (underprovided) / overprovided in previous years	(0.3)	0.2	(0.1)
Total deferred tax credit	3.0	1.7	4.7
Total tax (charge) / credit in the income statement	(27.2)	5.7	(21.5)
Statement of comprehensive income
Current tax on additional pension contributions			4.3
Deferred tax on actuarial losses on defined benefit pension schemes			(16.7)
Deferred tax in respect of cash flow hedges accounted for in the hedging reserve			(0.5)
Tax on exchange differences accounted for in the translation reserve			1.5
Total tax charge in the statement of comprehensive income			(11.4)
Statement of changes in equity
Current tax on share options exercised			0.7
Deferred tax on share options granted to employees			(2.5)
Total tax charge in the statement of changes in equity			(1.8)

	2010
Income statement	Before exceptional & other Items £m	Exceptional & other items £m	Total £m
Current income tax
Current income tax (charge) / credit Amounts overprovided in previous years	(33.2) 1.6	2.0 0.8	(31.2) 2.4
Total current income tax (charge) / credit	(31.6)	2.8	(28.8)
Deferred income tax Origination and reversal of temporary differences Amounts underprovided in previous years	2.6 (0.1)	6.9 –	9.5 (0.1)
Total deferred tax credit	2.5	6.9	9.4
Total tax (charge) / credit in the income statement	(29.1)	9.7	(19.4)
Statement of comprehensive income Current tax on additional pension contributions Deferred tax on actuarial losses on defined benefit pension schemes Deferred tax in respect of cash flow hedges accounted for in the hedging reserve Tax on exchange differences accounted for in the translation reserve			2.8 8.3 (0.3) 1.9
Total tax credit in the statement of comprehensive income			12.7
Statement of changes in equity Current tax on share options exercised Deferred tax on share options granted to employees			1.0 2.2
Total tax credit in the statement of changes in equity			3.2

b) Tax on profit on ordinary activities

		2009
	Before exceptional items £m	Exceptional items £m	Total £m
Income Statement
Current income tax
Current income tax (charge) / credit	(24.3)	2.9	(21.4)
Amounts under provided in previous years	(1.5)	–	(1.5)
Total current income tax (charge) / credit	(25.8)	2.9	(22.9)
Deferred income tax
Origination and reversal of temporary differences	0.8	–	0.8
Amounts overprovided in previous years	2.7	–	2.7
Total deferred tax credit	3.5	–	3.5
Total tax (charge) / credit in the income statement	(22.3)	2.9	(19.4)
Statement of Recognised Income and Expense
Current tax on additional pension contributions			2.8
Current tax on share options exercised			0.1
Deferred tax on movement in pension liabilities			16.9
Deferred tax on share options granted to employees			1.4
Net tax benefit reported in equity			21.2

c) Reconciliation of the total tax charge

The tax expense in the income statement is higher (2011: lower, 2010: higher) than the standard rate of corporation tax in the UK of 25% (2011: 27%, 2010: 28%, 2009: 29%). The differences are reconciled below:

		2012
	Before exceptional & other items £m	Exceptional & other Items £m	Total £m
Profit / (loss) before tax	84.4	(6.9)	77.5
Profit / (loss) multiplied by the UK average rate of corporation tax of 25%	(21.1)	1.7	(19.4)
Permanent differences	1.2	(0.6)	0.6
Impact of change in UK tax rate on deferred tax liability	2.0	0.2	2.2
Tax overprovided in previous years	(1.7)	(0.3)	(2.0)
Overseas tax rates	(1.9)	0.4	(1.5)
	(21.5)	1.4	(20.1)
Effective income tax rate	25.5%		25.9%

		2011
	Before exceptional & other items £m	Exceptional & other Items £m	Total £m
Profit / (loss) before tax	105.1	(25.2)	79.9
Profit / (loss) multiplied by the UK average rate of corporation tax of 27%	(28.4)	6.8	(21.6)
Permanent differences	(0.2)	0.1	(0.1)
Impact of change in UK tax rate on deferred tax liability	1.1	0.1	1.2
Tax overprovided in previous years	0.8	(0.1)	0.7
Overseas tax rates	(0.5)	(1.2)	(1.7)
	(27.2)	5.7	(21.5)
Effective income tax rate	25.9%		26.9%

		2010
	Before exceptional & other items £m	Exceptional & other Items £m	Total £m
Profit / (loss) before tax	109.1	(137.9)	(28.8)
Profit / (loss) multiplied by the UK average rate of corporation tax of 28%	(30.5)	38.6	8.1
Expenditure not deducted for income tax purposes	(0.5)	(12.4)	(12.9)
Tax relief on share-based payments Tax overprovided in previous years	0.1 1.5	– 0.8	0.1 2.3
Overseas tax rates	0.3	(17.3)	(17.0)
	(29.1)	9.7	(19.4)
Effective income tax rate	26.7%		(67.4%)
		2009
	Before exceptional items £m	Exceptional items £m	Total £m
Profit / (loss) before tax	86.5	(20.3)	66.2
Profit multiplied by the UK average rate of corporation tax of 28%	(24.2)	5.7	(18.5)
Expenditure not deductible for income tax purposes	(1.8)	(0.1)	(1.9)
Tax relief on share-based payments	0.2	(0.2)	–
Tax overprovided in previous years	1.2	–	1.2
Overseas tax rates	2.3	(2.5)	(0.2)
	(22.3)	2.9	(19.4)
Effective income tax rate	25.8%		29.3%

d) Unrecognised tax items

The temporary differences associated with investments in subsidiaries for which a deferred tax liability has not been recognised total £3.8m (2011: £13.0m, 2010: £11.6m, 2009: £11.7m). No deferred tax has been provided in respect of these differences, since the timing of the reversals can be controlled and it is probable that the temporary differences will not reverse in the future.

The group expects that future remittances of earnings from its overseas subsidiaries will be covered by the UK dividend exemption and so the un-remitted earnings of these subsidiaries are not disclosed above.

A deferred tax asset of £nil (2011: £0.2m, 2010: £nil) has not been recognised in respect of tax losses. The tax losses do not expire under current tax legislation. Deferred tax assets have not been recognised as it is not probable that future taxable profits will be available against which the group can utilise the benefits therefrom.

e) Impact of rate change

The Finance Act 2012 enacted reductions in the UK corporation tax rates from 25% to 24% from 1 April 2012 and to 23% from 1 April 2013. The effect of the new rate is to reduce the deferred tax provision by a net £1.7m, comprising a credit of £2.2m to the Consolidated Income Statement and to reduce the amount within the Consolidated Statement of Comprehensive Income by £0.5m.

Additional changes to the main rate of UK Corporation Tax are proposed, to reduce the rate by 1% per annum to 22% by 1 April 2014. These changes had not been substantively enacted at the balance sheet date and consequently are not included in these financial statements. The effect of these proposed reductions would be to reduce the UK net deferred tax liability by £1.0m.

On 7 November 2011, the French government announced a proposal to apply a temporary two year 5% surcharge to the corporate tax liabilities of French companies whose turnover exceeds €250m. The effect of the new rate is to reduce the deferred tax provision by a net £0.1m, comprising a credit of £0.1m to the consolidated income statement.

f) Deferred tax

The deferred tax included in the balance sheet is as follows:

	2009 £m	2010 Restated* £m	2011 £m	2012 £m
Deferred tax liability
Accelerated capital allowances	(20.3)	(19.7)	(17.5)	(9.8)
Acquisition fair value adjustments	(13.3)	(21.5)	(20.2)	(17.8)
Other temporary differences	(4.1)	(3.1)	(0.1)	(0.1)
Pensions	–	–	–	(19.5)
Employee incentive plan	(0.2)	–	–	–
Deferred tax liability	(37.9)	(44.3)	(37.8)	(47.2)
Deferred tax asset
Employee incentive plan	4.0	6.7	3.7	3.6
Pensions	19.6	27.5	7.4	–
Other temporary differences	–	2.0	3.7	9.5
Deferred tax asset	23.6	36.2	14.8	13.1
Net deferred tax liability	(14.3)	(8.1)	(23.0)	(34.1)

Certain deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

		2010
	2009 £m	Restated* £m	2011 £m	2012 £m
Net deferred tax assets	2.6	6.2	–	–
Net deferred tax liabilities	(16.9)	(14.3)	(23.0)	(34.1)
	(14.3)	(8.1)	(23.0)	(34.1)

The deferred tax included in the income statement is as follows:

	2009 £m	2010 £m	2011 £m	2012 £m
Employee incentive plan	0.2	0.7	(0.5)	(1.1)
Accelerated capital allowances	3.9	1.0	2.2	7.8
Post employment benefits	(0.6)	(0.4)	(3.4)	(19.0)
Acquisition fair value adjustments	–	6.3	0.9	0.9
Other temporary differences	–	1.8	5.5	3.5
Deferred tax credit	3.5	9.4	4.7	(7.9)

£1.5m of the deferred tax credit in the current period relates to exceptional items (2011: £1.7m, 2010: £6.9m, 2009: none of the deferred tax credit in the prior period related to exceptional items).

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

11. Earnings per share

Basic earnings per share amounts are calculated by dividing the net profit / (loss) for the period attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the period.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.

The following table reflects the income and share data used in the basic and diluted earnings per share computations:

	2009 £m	2010 £m	2011 £m	2012 £m
Basic earnings per share Profit / (loss) for the period attributable to equity shareholders	46.8	(48.2)	58.4	57.4
Weighted average number of ordinary shares in issue for basic earnings per share	214.9	224.9	240.4	241.6
Basic earnings per share	21.8p	(21.4p)	24.3p	23.8p
Diluted earnings per share Profit / (loss) for the period attributable to equity shareholders	46.8	(48.2)	58.4	57.4
Weighted average number of ordinary shares in issue for diluted earnings per share	220.9	231.8	246.4	256.6
Diluted earnings per share	21.2p	(21.4p)* 23.7p		22.4p

* The diluted earnings per share is unchanged from the basic earnings per share, as the inclusion of the dilutive ordinary shares would reduce the loss per share and is therefore not dilutive in accordance with IAS 33 'Earnings per Share'.

The group presents as exceptional and other items on the face of the Income Statement, those significant items of income and expense which, because of the nature and infrequency of the events giving rise to them, merit separate presentation to allow shareholders to understand better the elements of financial performance in the period, so as to facilitate comparison with prior periods and to assess better trends in financial performance more readily.

To this end, basic and diluted earnings per share are also presented on this basis with the amortisation of acquisition related intangible assets also added back using the weighted average number of ordinary shares for both basic and diluted amounts as per the table below:

	2009 £m	2010 Restated* £m	2011 £m	2012 £m
Adjusted basic earnings per share
Profit / (loss) for the period attributable to equity shareholders	46.8	(48.2)	58.4	57.4
Add: Net impact of exceptional and other items	17.4	128.2	19.5	5.5
Add: Intangible assets amortisation (acquisition related)		2.2	3.1	2.9
	64.2	82.2	81.0	65.8
Weighted average number of ordinary shares in issue for basic earnings per share	214.9	224.9	240.4	241.6
Adjusted basic earnings per share	29.9p	36.5p	33.7p	27.2p
Adjusted diluted earnings per share
Profit for the period attributable to equity shareholders before exceptional items and
other items and acquisition related intangible assets amortisation	64.2	82.2	81.0	65.8
Weighted average number of ordinary shares in issue for diluted earnings per share	220.9	231.8	246.4	248.8
Adjusted diluted earnings per share	29.1p	35.5p	32.9p	26.5p

* The add back of amortisation of intangible assets was previously stated on a total basis. In order to better reflect the ongoing underlying earnings, only acquisition related amortisation is now adjusted and comparatives have been restated accordingly.

12. Dividends paid and proposed

	2009 £m	2010 £m	2011 £m	2012 £m
Declared and paid during the period
Equity dividends on ordinary shares
Final dividend for 2011: 12.6p per share (2010: 12.0p per share, 2009: 10.9p per share)	19.0	23.6	28.3	29.9
Interim dividend for 2012: 5.3p per share (2011: 5.1p per share, 2010: 4.7p per share)	8.8	11.3	12.0	12.6
Dividends paid	27.8	34.9	40.3	42.5
Proposed for approval by the shareholders at the AGM
Final dividend for 2012: 12.4p per share (2011: 12.6p per share, 2010: 12.0p per share)	23.5	28.7	29.9	30.1

13. Property, plant and equipment

	Freehold land and buildings £m	Leasehold land and buildings £m	Plant and machinery £m	Fixtures, fittings, tools and equipment £m	Total £m
At 28 September 2008, net of accumulated depreciation and
impairment	49.1	31.0	89.7	58.3	228.1
Reclassifications Exchange differences	– 1.3	– 1.7	0.8 3.0	(0.8) 0.8	– 6.8
Additions	0.5	3.1	17.2	14.4	35.2
Disposals at cost	–	–	(23.5)	(12.8)	(36.3)
Depreciation eliminated on disposals	–	–	13.8	11.1	24.9
Assets classified as held for sale – cost**	(1.5)	–	–	–	(1.5)
Assets classified as held for sale – depreciation** Depreciation charge for the year	0.1 (0.4)	– (0.8)	– (14.4)	– (14.5)	0.1 (30.1)
Impairment*	(1.1)	–	–	–	(1.1)
At 27 September 2009, net of accumulated depreciation and
impairment	48.0	35.0	86.6	56.5	226.1
Exchange differences	(0.5)	(0.6)	(0.7)	(0.7)	(2.5)
Acquisitions	18.0	–	17.4*	0.6	36.0
Additions Disposals at cost	1.6 –	1.0 –	18.0 (12.0)	17.4 (14.4)	38.0 (26.4)
Depreciation eliminated on disposals	–	–	7.2	13.2	20.4
Assets transferred which were previously held for sale	4.7	–	–	–	4.7
Depreciation charge for the year	(1.3)	(0.7)	(14.7)	(16.2)	(32.9)
Impairment	(8.8)	(5.8)	(1.1)	–	(15.7)
At 3 October 2010, net of accumulated depreciation and
impairment	61.7	28.9	100.7	56.4	247.7
Exchange differences Reclassifications	(0.3) (0.3)	(0.1) –	(0.5) 0.3	(0.1) –	(1.0) –
Acquisitions	0.5	–	0.1	–	0.6
Additions	1.4	0.5	23.7	12.6	38.2
Disposals at cost	(1.2)	(0.1)	(24.5)	(36.8)	(62.6)
Depreciation eliminated on disposals	0.7	–	23.8	33.2	57.7
Assets transferred to held for sale Depreciation charge for the year	(0.7) (1.9)	– (0.5)	– (18.0)	– (15.2)	(0.7) (35.6)
Impairment	–	–	(0.5)	–	(0.5)
At 2 October 2011, net of accumulated depreciation and
impairment	59.9	28.7	105.1	50.1	243.8
Exchange differences	(1.4)	(0.6)	(2.9)	(0.1)	(5.0)
Additions	3.5	0.4	20.2	15.5	39.6
Disposals at cost	(0.9)	–	(12.1)	(7.5)	(20.5)
Depreciation eliminated on disposals Depreciation charge for the year	0.1 (2.1)	– (0.7)	11.0 (19.6)	6.3 (12.0)	17.4 (34.4)
Impairment	–	–	–	(4.3)	(4.3)
At 30 September 2012, net of accumulated depreciation and
impairment	59.1	27.8	101.7	48.0	236.6
At 30 September 2012
Cost (gross carrying amount)	77.9	39.9	255.1	166.6	539.5
Accumulated depreciation and impairment	(18.8)	(12.1)	(153.4)	(118.6)	(302.9)
Net carrying amount	59.1	27.8	101.7	48.0	236.6
At 2 October 2011
Cost (gross carrying amount) Accumulated depreciation and impairment	78.6 (18.7)	40.6 (11.9)	256.1 (151.0)	161.4 (111.3)	536.7 (292.9)
Net carrying amount	59.9	28.7	105.1	50.1	243.8
At 3 October 2010
Cost (gross carrying amount) Accumulated depreciation and impairment	79.2 (17.5)	40.3 (11.4)	257.0 (156.3)	185.7 (129.3)	562.2 (314.5)
Net carrying amount	61.7	28.9	100.7*	56.4	247.7
At 27 September 2009
Cost (gross carrying amount) Accumulated depreciation and impairment	55.4 (7.4)	39.9 (4.9)	234.3 (147.7)	182.8 (126.3)	512.4 (286.3)
Net carrying amount	48.0	35.0	86.6	56.5	226.1

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

** Further details are given in Note 21.

During 2011, properties with a net book value of £26.6m, comprising freehold land and buildings of £21.4m and leasehold land and buildings of £5.2m, were transferred to Britvic Property Partnership (see note 24). These secure the future income stream to the pension plan.

Finance leases

The net book value of freehold land and buildings and plant and machinery includes £0.2m and £0.3m respectively (2011: £0.3m and £0.5m respectively, 2010: £0.5m and £0.9m respectively, 2009: £nil) in respect of assets held under finance leases. The assets are pledged as security for the finance lease liabilities.

14. Intangible assets

	Trade marks £m	Franchise rights £m	Customer lists £m	Software costs £m	Goodwill £m	Total £m
Cost as at 28 September 2008,	63.1	22.7	13.8	22.8	141.4	263.8
net of accumulated amortisation
Exchange differences Additions	10.3 –	3.6 –	2.2 –	– 11.2	10.7 –	26.8 11.2
Disposals at cost	–	–	–	(0.3)	–	(0.3)
Amortisation eliminated on disposals	–	–	–	0.2	–	0.2
Amortisation charge for the year	(0.1)	(0.7)	(0.9)	(6.9)	–	(8.6)
Cost as at 27 September 2009, net of
accumulated amortisation	73.3	25.6	15.1	27.0	152.1	293.1
Exchange differences	(4.3)	(1.3)	(0.6)	0.2	(5.4)	(11.4)
Acquisitions	62.4	–	35.2	1.2	62.9*	161.7
Additions	–	–	–	9.6	–	9.6
Disposals at cost	–	–	–	(0.6)	–	(0.6)
Amortisation eliminated on disposals	–	–	–	0.6	–	0.6
Amortisation charge for the period	–	(0.8)	(1.4)	(7.3)	–	(9.5)
Impairment	(29.8)	–	(5.1)	–	(66.1)	(101.0)
Cost as at 3 October 2010, net of accumulated amortisation	101.6	23.5	43.2	30.7	143.5	342.5
Exchange differences	(1.7)	(0.2)	(0.5)	(0.2)	(1.1)	(3.7)
Acquisitions	–	–	–	–	0.4	0.4
Additions	–	–	–	11.9	–	11.9
Disposals at cost	–	–	–	(24.6)	–	(24.6)
Amortisation eliminated on disposals	–	–	–	24.3	–	24.3
Amortisation charge for the period	–	(0.7)	(2.4)	(9.8)	–	(12.9)
Cost as at 2 October 2011, net of accumulated amortisation	99.9	22.6	40.3	32.3	142.8	337.9
Exchange differences	(7.4)	(1.6)	(2.9)	(0.2)	(5.9)	(18.0)
Additions	–	–	–	5.4	–	5.4
Amortisation charge for the period	–	(0.7)	(2.2)	(6.6)	–	(9.5)
Impairment	–	–	–	(10.6)	–	(10.6)
At 30 September 2012	92.5	20.3	35.2	20.3	136.9	305.2
At 30 September 2012
Cost (gross carrying amount)	120.1	23.6	47.2	56.0	198.9	445.8
Accumulated amortisation and impairment	(27.6)	(3.3)	(12.0)	(35.7)	(62.0)	(140.6)
Net carrying amount	92.5	20.3	35.2	20.3	136.9	305.2
At 2 October 2011
Cost (gross carrying amount)	129.8	25.5	51.0	51.8	208.9	467.0
Accumulated amortisation and impairment	(29.9)	(2.9)	(10.7)	(19.5)	(66.1)	(129.1)
Net carrying amount	99.9	22.6	40.3	32.3	142.8	337.9
At 3 October 2010
Cost (gross carrying amount)	131.5	25.7	51.5	64.7	209.6	483.0
Accumulated amortisation and impairment	(29.9)	(2.2)	(8.3)	(34.0)	(66.1)	(140.5)
Net carrying amount	101.6	23.5	43.2	30.7	143.5*	342.5
At 27 September 2009
Cost (gross carrying amount)	73.4	27.0	16.9	54.3	152.1	323.7
Accumulated amortisation	(0.1)	(1.4)	(1.8)	(27.3)	–	(30.6)
Net carrying amount	73.3	25.6	15.1	27.0	152.1	293.1

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

Trade marks

Britvic Ireland and Britvic France

Trade marks represent those trade names acquired which the group plans to maintain. All trade marks have been allocated an indefinite life by management. A list of the trade marks held in respect of the Britvic Ireland and Britvic France segments is shown in note 16.

It is expected, and in line with existing well-established trade marks within the group, that the trade marks with indefinite lives in respect of Britvic France and Britvic Ireland will be held and supported for an indefinite period of time and are expected to generate economic benefits. The group is committed to supporting its trade marks by investing in significant consumer marketing promotional spend.

Franchise rights

Franchise rights represent the franchise agreements acquired as part of the Britvic Ireland business combination which provide the long term right to distribute certain soft drinks. These agreements have been allocated a 35 year useful economic life. As at 30 September 2012 these intangible assets have a remaining useful life of 30 years. The franchise agreement itself has a contract life less than the useful economic life. The useful economic life has been determined on the basis that the renewal of the contract is highly probable.

Customer lists

Britvic France

Customer lists recognised on the acquisition of Britvic France relate to those customer relationships acquired. These intangible assets have been allocated useful economic lives of 20 years. As at 30 September 2012 these intangible assets have a remaining useful life of 18 years.

Britvic Ireland

Customer lists represent those customer relationships acquired which are valued in respect of the grocery and wholesale businesses. These customer lists have been allocated useful economic lives of between 10 and 20 years. As at 30 September 2012 these intangible assets have a remaining useful life of between 5 and 15 years.

Software costs

Software is capitalised at cost. These intangible assets have been assessed as having finite lives and are amortised using the straight-line method over a period of 3 to 7 years. These assets are tested for impairment where an indicator of impairment arises. As at 30 September 2012 these intangible assets have a remaining useful life of up to 5 years.

Goodwill

Goodwill is not amortised. Instead it is subject to an impairment review at each reporting date in accordance with IAS 36 'Impairment of Assets'. Further detail is provided in note 16.

Intangible assets recognised on the acquisition of Britvic Ireland and Britvic France are valued in euros and translated to sterling at the reporting date.

15. Business combinations

Acquisition of Britvic France

On 28 May 2010, the group acquired Britvic France for a cash consideration of €186.4m (translated at £160.5m at the time of acquisition).

The initial fair value / acquisition accounting for Britvic France was determined provisionally in the financial statements for the 53 weeks ended 3 October 2010. The fair value adjustments have now been finalised and are shown in the table below. The overall impact of the changes made result in an increase to goodwill of £1.0m. The comparatives for the 53 weeks ended 3 October 2010 have been adjusted in these financial statements to reflect these updated fair values accordingly.

The difference between the fair value of the consideration paid and the fair value of the identifiable net assets acquired is recognised as goodwill. Included in goodwill are certain intangible assets that cannot be separated and reliably measured due to their nature. These items include the favourable market presence which Britvic France enjoys, an assembled workforce and anticipated future operating synergies from the combination.

The sterling carrying value of the net assets acquired shown in the table below has been calculated using the exchange rate on the date of acquisition which was £1: €1.1611.

	Book value €m	Fair value adjustments €m	Fair value €m	Fair value £m
Intangible assets	81.4	33.3	114.7	98.8
Property, plant and equipment	27.2	14.7	41.9	36.0
Other financial assets	2.3	–	2.3	2.0
Inventories	35.7	2.1	37.8	32.6
Trade and other receivables	73.2	–	73.2	63.0
Cash and cash equivalents	10.0	–	10.0	8.6
Trade and other payables	(86.2)	–	(86.2)	(74.2)
Pension liability	(1.2)	–	(1.2)	(1.0)
Interest bearing loans and borrowings	(53.4)	–	(53.4)	(46.0)
Other non-current liabilities	(3.8)	–	(3.8)	(3.3)
Other financial liabilities	(0.9)	–	(0.9)	(0.8)
Deferred tax liability	–	(17.7)	(17.7)	(15.3)
Current income tax payable	(1.8)	(1.5)	(3.3)	(2.8)
Net assets acquired	82.5	30.9	113.4	97.6
Purchased goodwill			73.0	62.9
Cost of investment satisfied by cash consideration			186.4	160.5

16. Impairment testing of intangible assets

Goodwill

Goodwill acquired through business combinations has been allocated by senior management to eight individual cash-generating units for impairment testing as follows:

• Red Devil;
• Orchid;
• Tango;
• Robinsons;
• Britvic Soft Drinks business ('BSD');
• Water Business;
• Britvic Ireland; and
• Britvic France.

With the exception of Britvic Ireland and Britvic France, all other goodwill amounts were recognised on acquisitions made within Britvic GB.

Carrying amount of goodwill

	Red Devil £m	Orchid £m	Tango £m	Robinsons £m	BSD £m	Water £m	Britvic Ireland £m	Britvic France Restated £m	Total £m
At 30 September 2012	–	6.0	8.9	38.6	7.8	1.7	15.8	58.1	136.9
At 2 October 2011	–	6.0	8.9	38.6	7.8	1.7	17.0	62.8	142.8
At 3 October 2010	–	6.0	8.9	38.6	7.8	1.7	16.8	63.7*	143.5
At 27 September 2009	5.1	12.4	8.9	38.6	7.8	1.7	77.6	–	152.1

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

The Britvic Ireland and Britvic France goodwill is valued in euros and translated at the reporting date.

Apart from a £0.4m increase in goodwill in Ireland in 2011 relating to the non-material acquisition of Quinn's of Cookstown, there are no movements other than translation movements.

Trade marks with indefinite lives

Carrying amount of trade marks with indefinite lives in the Ireland segment

As part of the fair value exercise regarding the 2007 acquisition of Britvic Ireland, certain trade marks with indefinite lives were recognised. These trade marks have been allocated by senior management to five individual cash-generating units for impairment testing as follows:

	Britvic £m	Cidona £m	Mi-Wadi £m	Ballygowan £m	Club £m	TX £m
At 30 September 2012	6.0	5.3	8.1	2.2	13.5	–
At 2 October 2011	6.4	5.7	8.8	2.4	14.6	–
At 3 October 2010	6.5	5.8	8.9	2.5	14.8	–
At 27 September 2009	10.8	8.7	9.4	28.1	15.6	0.6

The trade marks are valued in euros and translated at the reporting date. The movements in the carrying amount from the prior year relate only to translation movements.

Carrying amount of trade marks with indefinite lives in the France segment

Additional trade marks with indefinite lives were recognised as part of the fair value exercise on the 2010 acquisition of Britvic France. These trade marks have been allocated by senior management to four individual cash-generating units for impairment testing as follows:

		Moulin de Valdonne £m	Pressade £m	Fruité £m
At 30 September 2012	45.4	3.7	4.3	4.0
At 2 October 2011	49.1	4.0	4.6	4.3
At 3 October 2010	49.9	4.1	4.7	4.4

The trade marks are valued in euros and translated at the reporting date. The movements in the carrying amount from the prior year only relate to translation movements.

Method of impairment testing

The recoverable amount of the goodwill and intangible assets allocated to the cash-generating units detailed above has been determined based on a value in use calculation. To calculate this, cash flow projections are based on financial budgets prepared by senior management and approved by the Board of Directors.

The group has considered the impact of the current economic climate in determining the appropriate discount rate to use in impairment testing. The pre-tax discount rate applied to pre-tax cash flow projections is 11 per cent. (2011: 11 per cent., 2010: 11 per cent.) for goodwill relating to Britvic GB. A pre-tax discount rate of 11 per cent. (2011: 11 per cent., 2010: 10 per cent., 2009: 9 per cent.) was applied for the Britvic Ireland goodwill and trade marks recognised on the acquisition of Britvic Ireland. A pre-tax discount rate of 12 per cent. (2011: 12 per cent.) was applied for the Britvic France goodwill and trade marks recognised on the acquisition of Britvic France.

Cash flows beyond a one year period are extrapolated based on senior management forecasts for the following four years and beyond that based on growth and inflationary assumptions as described below. No growth besides inflationary growth increases is assumed beyond five years given the current economic uncertainty. Senior management expectations are formed in line with performance to date and experience, as well as available external market data.

Key assumptions used in value in use calculation

The following describes each key assumption on which management has based its cash flow projections to undertake impairment testing of goodwill.

Growth rates – reflect senior management expectations of volume growth based on growth achieved to date, current strategy and expected market trends. No growth besides inflationary growth increases is assumed beyond five years given the current economic uncertainty.

Discount rates – reflect senior management's estimate of the pre-tax cost of capital adjusted where necessary to reflect the different risks of different countries in which the group operates. The estimated pre-tax cost of capital is the benchmark used by management to assess operating performance and to evaluate future capital investment proposals.

Marginal contribution – being revenue less material costs and all other marginal costs that management considers to be directly attributable to the sale of a given product. Marginal contribution is based on financial budgets approved by the Britvic plc board. Key assumptions are made within these budgets about pricing, discounts and costs based on historical data, current strategy and expected market trends.

Advertising and promotional spend – financial budgets approved by senior management are used to determine the value assigned to advertising and promotional spend. This is based on the planned spend for year one and strategic intent thereafter.

Raw materials price, production and distribution costs, selling costs and other overhead inflation – the basis used to determine the value assigned to inflation is the forecast increase in consumer price indices in the relevant market. This has been used in all value in use calculations performed.

Conclusions

In 2010, impairment losses were recognised in respect of Red Devil goodwill (£5.0m), Orchid goodwill (£6.4m), Britvic Ireland goodwill (£54.7m), Britvic Ireland indefinite life trade marks (£29.7m) and Britvic Ireland finite life trade marks (£0.1m). No further impairments have been identified during 2011 and 2012 and there are no reasonably possible changes in key assumptions other than a further, currently unforecast material decline in the prospects for the economies in which the group operates, which would cause the value of the goodwill or any of the intangible assets with indefinite lives to materially fall short of their carrying value.

Intangible assets with finite lives

Franchise rights

Franchise rights represent the franchise agreements acquired, as a result of the acquisition of Britvic Ireland, which provide the long term right to distribute certain soft drinks. Management have reviewed the performance of those products since acquisition and no indicators of impairment have been identified (2011: £nil).

Customer lists

As part of the fair value exercise regarding the acquisitions of Britvic Ireland in 2007 and Britvic France in 2010, customer list assets with finite lives were recognised. Management have reviewed trading levels with those customers since acquisition and in 2010 identified a number of material reductions which have been directly attributed to the difficult trading conditions experienced in Ireland due to the sustained economic downturn. As a result an impairment loss of £5.1m was recognised in 2010.

No indicators of impairment have been identified in the current year (2011: £nil) and accordingly no further impairments have been recognised in respect of customer lists.

Recognition of impairment losses

In 2010, impairment losses, in respect of intangible assets as detailed above, totalling £101.0m were recognised in the income statement within exceptional administration expenses. £11.4m related to the GB carbs business segment and £89.6m related to the Britvic Ireland business segment.

17. Other receivables (non-current)

	2009 £m	2010 £m	2011 £m	2012 £m
Operating lease premiums	2.4	2.3	2.3	2.3
Prepayments	–	–	3.1	1.3
Other	–	–	0.2	–
Total other receivables (non-current)	2.4	2.3	5.6	3.6

Operating lease premiums relates to the un-amortised element of lease premiums paid on inception of operating leases.

18. Inventories

	2010
	2009 £m	Restated* £m	2011 £m	2012 £m
Raw materials	13.4	22.9	28.6	22.2
Finished goods	29.3	50.8	49.2	42.5
Consumable stores	5.3	6.0	6.1	7.2
Returnable packaging	4.9	3.9	4.6	1.9
Total inventories at lower of cost and net realisable value	52.9	83.6	88.5	73.8

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

19. Trade and other receivables (current)

	2009 £m	2010 £m	2011 £m	2012 £m
Trade receivables	145.5	184.4	209.1	207.7
Other receivables	8.1	8.8	10.8	19.7
Prepayments	24.3	34.8	30.1	30.0
	177.9	228.0	250.0	257.4

Trade receivables are non-interest bearing and are generally on credit terms usual for the markets in which the group operates. As at 30 September 2012, trade receivables at nominal value of £2.5m (2011: £1.2m, 2010: £1.2m, 2009: £1.3m) were impaired and fully provided against. Movements in the provision for impairment of receivables were as follows:

	Total £m
At 28 September 2008	1.4
Exchange differences	0.1
Charge for period	1.1
Utilised	(0.9)
Unused amounts reversed	(0.4)
At 27 September 2009	1.3
Acquisition	0.5
Charge for period	0.8
Utilised	(0.6)
Unused amounts reversed	(0.8)
At 3 October 2010	1.2
Charge for period	1.0
Utilised	(0.5)
Unused amounts reversed	(0.5)
At 2 October 2011	1.2
Charge for period	1.9
Utilised	(0.5)
Unused amounts reversed	(0.1)
At 30 September 2012	2.5

The group takes the following factors into account when considering whether a provision for impairment should be made for trade receivables:

• Payment performance history; and
• External information available regarding credit ratings.

As at 30 September 2012, the ageing analysis of trade receivables is as follows:

			Past due but not impaired
	Total £m	Neither past due nor impaired £m	<30 days £m	30 – 60 days £m	60 – 90 days £m	90 – 120 days £m	>120 days £m
2012	207.7	196.5	6.7	0.3	2.0	0.5	1.7
2011	209.1	194.1	12.0	0.8	0.5	0.5	1.2
2010	184.4	172.2	7.5	2.1	1.7	0.9	–
2009	145.5	134.1	8.2	1.6	0.8	0.8	–

The credit quality of trade receivables that are neither past due nor impaired is considered good. Refer to note 26 for details of the group's credit risk policy. The group does however monitor the credit quality of trade receivables by reference to credit ratings available externally.

20. Cash and cash equivalents

	2009 £m	2010 £m	2011 £m	2012 £m
Cash at bank and in hand	39.7	54.0	43.0	49.5
Bank overdrafts	–	–	–	(1.9)
Cash and cash equivalents in the statement of cash flows	39.7	54.0	43.0	47.6

During the year short-term deposits are made for varying periods of between one day and one month depending on the immediate cash requirements of the group, and earn interest at the respective short-term deposit rates. The fair value of cash and cash equivalents is equal to the book value.

At 30 September 2012, the group had available £400.0m (2011: £400.0m, 2010: £213.0m, 2009:£154.7m) of un-drawn committed borrowing facilities in respect of which all conditions precedent had been met.

Where available, the group operates cash pooling arrangements whereby the net cash position across a number of accounts is recognised for interest purposes.

21. Non-current assets held for sale

	2009	2010	2011	2012
	£m	£m	£m	£m
Net transfer from property, plant and equipment	5.1	–	0.7	–

2012

During the first half of the year a property with net book value of £0.4m was held for sale in Britvic GB. The sale of the property completed on 13 September 2012 resulting in a profit of £0.4m. There was no gain or loss on transfer from property, plant and equipment to non-current assets held for sale.

2011

The transfer related to a property held for sale in Britvic France. The sale of the property completed on 10 November 2011 resulting in a profit of £0.2m. There was no gain or loss on transfer from property, plant and equipment to non-current assets held for sale.

2009

In the period, non-current assets held for sale related to three sites within the Britvic Ireland segment which are being disposed of as a result of the ongoing restructuring programme in that business. Due to the continued deterioration of the economy in the Republic of Ireland, conditions for a successful sale have been very challenging in the current period. As such the assets have been transferred back into property, plant and equipment during the current period.

22. Issued share capital

The issued share capital as at 30 September 2012 comprised 242,344,551 ordinary shares of £0.20 each (2011: 241,400,052 ordinary shares, 2010: 239,906,178 ordinary shares, 2009: 216,779,996 ordinary shares), totalling £48,468,910 (2011: £48,280,010, 2010: £47,981,236, 2009:£43,355,999).

The ordinary shares carry voting rights of one vote per share. There are no restrictions placed on the distribution of dividends, or the return of capital on a winding up or otherwise.

	2009 £m	2010 £m	2011 £m	2012 £m
Authorised 327,500,000 ordinary shares of £0.20 each	65.5	65.5	65.5	*
Called up, issued and fully paid ordinary shares 242,344,551 (2011: 241,400,052, 2010: 239,906,178, 2009: 216,779,996) ordinary shares of £0.20 each	43.4	48.0	48.3	48.5

* No longer applicable following changes to the Companies Act

Share issues in the current and prior periods relating to incentive schemes for employees are detailed below:

52 weeks ended 30 September 2012	No of shares issued	Nominal Value £
6 December 2011	27,148	5,430
14 December 2011	500,000	100,000
8 February 2012	32,577	6,515
10 February 2012	14,116	2,823
15 February 2012	31,204	6,241
27 March 2012	48,912	9,783
5 September 2012	46,805	9,361
11 September 2012	24,660	4,932
19 September 2012	19,077	3,815
26 September 2012	200,000	40,000
	944,499	188,900

52 weeks ended 2 October 2011	No of shares issued	Nominal Value £
2 December 2010	12,244	2,449
15 December 2010	122,449	24,490
23 December 2010	21,974	4,395
4 February 2011	300,000	60,000
1 April 2011	32,013	6,402
8 April 2011	484,343	96,868
12 May 2011	20,851	4,170
27 June 2011	500,000	100,000
	1,493,874	298,774

Nominal

53 weeks ended 3 October 2010	No of shares issued	Value £
25 November 2009	103,102	20,620
30 November 2009	134,684	26,937
7 December 2009	34,837	6,967
14 January 2010	57,749	11,550
28 January 2010	131,140	26,228
22 February 2010	57,789	11,558
5 March 2010	50,039	10,008
29 March 2010	46,118	9,224
9 April 2010	406,083	81,217
1 June 2010	12,244	2,449
19 August 2010	300,000	60,000
1 October 2010	12,244	2,449
	1,346,029	269,207

	No of shares issued	Value £
14 July 2009	29,333	5,867
1 September 2009	7,868	1,574
25 September 2009	705,000	141,000
	742,201	148,441

Of the issued and fully paid ordinary shares, 217,994 shares (2011: 258,683 shares, 2010: 466,343 shares, 2009: 1,410,338 shares) are treasury shares. This equates to £3,599 (2011: £51,737, 2010: £93,269, 2009: £282,068) at £0.20 par value of each ordinary share. These shares are held for the purpose of satisfying the share schemes detailed in note 29.

An explanation of the group's capital management process and objectives is set out in note 26.

23. Interest bearing loans and borrowings

	2009 £m	2010 £m	2011 £m	2012 £m
Current
Finance leases	–	–	–	(0.3)
Bank loans	–	–	–	(0.3)
Total current	–	–	–	(0.6)
	2009 £m	2010 £m	2011 £m	2012 £m
Non-current
Finance leases	–	(1.5)	(1.2)	(0.5)
Unsecured bank loans	(180.2)	(126.3)	(2.2)	(1.1)
Private placement notes	(274.6)	(445.7)	(574.4)	(560.8)
Less unamortised issue costs	4.1	3.6	4.6	3.7
Total non-current	(450.7)	(569.9)	(573.2)	(558.7)

The table below provides an analysis of amounts included within interest bearing loans and borrowings:

	2009	2010	2011	2012
	£m	£m	£m	£m
Finance leases	–	(1.5)	(1.2)	(0.8)
2007 Notes	(273.1)	(275.0)	(278.6)	(269.9)
2009 Notes	–	(167.9)	(174.3)	(171.8)
2010 Notes	–	–	(116.5)	(114.5)
Accrued interest	(3.0)	(3.8)	(5.0)	(4.6)
Unsecured bank loans	(178.7)	(125.3)	(2.2)	(1.4)
Capitalised issue costs	4.1	3.6	4.6	3.7
	(450.7)	(569.9)	(573.2)	(559.3)

Analysis of changes in interest-bearing loans and borrowings

	2009 £m	2010 £m	2011 £m	2012 £m
At the beginning of the period	(414.3)	(450.7)	(569.9)	(573.2)
Acquisition of Britvic France	–	(46.0)	–	–
Net loans repaid	7.3	95.0	123.4	0.7
Repayment of finance leases	–	–	–	0.3
Issue of 2010 / 2009 Notes	–	(149.8)	(113.9)	–
Issue costs	4.1	1.2	3.9	–
Amortisation and write off of issue costs	(1.0)	(1.7)	(2.9)	(0.9)
Net translation loss / fair value adjustment	(45.4)	(17.1)	(12.6)	13.5
Accrued interest	(1.4)	(0.8)	(1.2)	0.3
At the end of the period	(450.7)	(569.9)	(573.2)	(559.3)
Derivatives hedging balance sheet debt*	44.6	64.7	78.2	65.0
Debt translated at contracted rate	(406.1)	(505.2)	(495.0)	(494.3)

* Represents the element of the fair value of interest rate currency swaps hedging the balance sheet value of the Notes. This amount has been disclosed separately to demonstrate the impact of foreign exchange movements which are included in interest bearing loans and borrowings.

Bank loans

The bank loans classified as non-current are repayable by December 2018 (2011: December 2012 and 2018).

Loans outstanding at 30 September 2012 attract interest at an average rate of 4.16% for euro denominated loans (2011: 5.09%). There were no sterling denominated loans outstanding at 30 September 2012 (2011: Nil).

Private placement notes

2007 Notes

On 20 February 2007, Britvic plc issued US\$375m and £38m of Senior Notes ('the 2007 Notes') in the United States Private Placement market. The proceeds of the issue were used to repay and cancel a £150m term loan, with the remainder being used to repay the amounts drawn on the group's revolving credit facility. The amount, maturity and interest terms of the Notes are shown in the table below:

Series	Tranche	Maturity date	Amount	Interest terms	Swap interest
A	7 year	20 February 2014	US\$87m	US\$ fixed at 5.80%	UK£ fixed at 6.10%
B	7 year	20 February 2014	US\$15m	US\$ LIBOR + 0.5%	UK£ fixed at 6.07%
C	7 year	20 February 2014	£25m	UK£ fixed at 6.11%	n/a
D	10 year	20 February 2017	US\$147m	US\$ fixed at 5.90%	UK£ fixed at 5.98%
E	12 year	20 February 2019	US\$126m	US\$ fixed at 6.00%	UK£ fixed at 5.98%
F	12 year	20 February 2019	£13m	UK£ fixed at 5.94%	n/a

Britvic plc makes quarterly and semi-annual interest payments in the currency of issue. The Notes are unsecured and rank pari passu in right of repayment with other senior unsecured indebtedness of the company. In order to manage the risk of foreign currency and interest rate fluctuations, the group has entered into currency interest rate swaps whereby fixed / floating US dollar interest is swapped for fixed sterling interest. The swap contracts have the same duration and other critical terms as the borrowings which they hedge and are designated as part of effective hedge relationships (see note 27).

Covenants on these Notes include a term which states that Britvic plc must offer to repay the Notes should a change in control of the group occur which results in a downwards movement in the credit rating as defined in the Note purchase agreement.

2009 Notes

On 17 December 2009, Britvic plc issued US\$250m of Senior Notes in the United States Private Placement market ('the 2009 Notes'). The 2009 Notes are additional borrowings to the 2007 Notes. The proceeds from the 2009 Notes were principally used to repay amounts drawn on the group's existing borrowings, including the repayment of €100m of the revolving credit facility.

Britvic plc makes semi-annual interest payments in US dollars, with the first payment being made on 17 June 2010. The 2009 Notes are unsecured and rank pari passu in right of repayment with other senior unsecured indebtedness of the group.

In order to manage foreign exchange risk, interest rate risk and to ensure an appropriate mix of sterling and euro funding, the group has entered into a number of new cross currency interest rate swaps. The 2009 Notes were swapped into floating rate sterling and euro liabilities through a series of US dollar to sterling and sterling to euro swap instruments. These cross currency interest rate swap contracts have the same duration and other critical terms as the relevant borrowings they hedge and are designated as part of effective hedge relationships (see note 27).

The amount, maturity and interest terms of the 2009 Notes are shown in the table below:

Series	Tranche	Maturity date	Amount	Interest terms	Swap terms
A	5 year	17 December 2014	US\$ 30m		US\$ fixed at 4.07% UK£ LIBOR + 1.44%
B	7 year	17 December 2016	US\$ 75m		US\$ fixed at 4.77% EURIBOR + 1.69%
C	8 year	17 December 2017	US\$ 25m		US\$ fixed at 4.94% EURIBOR + 1.70%
D	10 year	17 December 2019	US\$120m		US\$ fixed at 5.24% EURIBOR + 1.75%

As detailed in the table above, the 2009 USPP cross currency swaps converted an amount of US dollar borrowings into a €147.0m floating rate euro liability. To mitigate exposure to changes in euro interest rates on this liability, €75.0m of interest rate swaps were transacted. These swaps do not form part of an effective hedge relationship.

2010 Notes

On 17 December 2010, Britvic plc issued US\$163m and £7.5m of Senior Notes in the United States Private Placement market ('the 2010 Notes'). The 2010 Notes are additional borrowings to the 2007 and 2009 Notes. The proceeds from the 2010 Notes were principally used to repay amounts drawn on the group's existing borrowings. Issue costs incurred in the period relate to the issue of the 2010 Notes and the refinancing of the group's bank facilities.

Britvic plc makes semi-annual interest payments in US dollars with the first payment being made on 17 June 2011. The 2010 Notes are unsecured and rank pari passu in right of repayment with other senior unsecured indebtedness of the group.

In order to manage foreign exchange risk, interest rate risk and to ensure an appropriate mix of sterling and euro funding, the group has entered into a number of cross currency interest rate swaps. The 2010 Notes were swapped into a mix of fixed and floating rate sterling and euro liabilities through a series of US dollar to sterling and sterling to euro swap instruments. These cross currency interest rate swap contracts have the same duration and other critical terms as the relevant borrowings they hedge and are designated as part of effective hedge relationships (see note 27).

The amount, maturity and interest terms of the 2010 Notes are shown in the table below:

Series	Tranche	Maturity date	Amount	Interest terms	Swap terms
A	7 year	17 December 2017	£ 7.5m	UK£ fixed at 3.74% N/A
B	7 year	17 December 2017	US\$ 25m	US\$ fixed at 3.45% UK£ fixed 3.85%
			US\$ 25m	US\$ fixed at 3.45% €	fixed 3.34%
C	10 year	17 December 2020	US\$ 37m		US\$ fixed at 4.04% UK£ LIBOR +1.24%
			US\$ 23m	US\$ fixed at 4.04% €	fixed 3.85%
			US\$ 10m	US\$ fixed at 4.04% UK£ fixed 4.49%
D	12 year	17 December 2022	US\$ 18m		US\$ fixed at 4.14% UK£ LIBOR +1.18%
			US\$ 25m	US\$ fixed at 4.14% €	fixed 3.97%

As detailed in the table above, the 2010 USPP cross currency swaps converted an amount of US dollar borrowings into a £35.6m floating rate sterling liability. To mitigate exposure in a proportion of this liability, £20m of 3-year interest rate swaps were transacted with an effective date of December 2011. These interest rate swaps do not form part of an effective hedge relationship.

Covenants on all Notes include a term which states that Britvic must offer to repay the Notes should a change in control of the group occur which results in a downward movement in the credit rating as defined in the Note purchase agreement.

24. Pensions

The group principal pension scheme for GB employees, the Britvic Pension Plan (BPP), has both a defined benefit and a defined contribution section. The defined benefit section of the BPP was closed to new members on 1 August 2002, and following consultation with GB employees was closed to future accrual for active members with effect from 10 April 2011, with members moving into the defined contribution section for future service benefits.

Contributions are paid into the Plan in accordance with the recommendations of an independent actuary and as outlined in the Schedule of Contributions. The latest formal actuarial valuation for contribution purposes was carried out as at 31 March 2010. Following the conclusion of the previous triennial valuation, the final annual payment of £10m contributions in respect of the funding shortfall, outlined in the recovery plan, was made by 31 December 2010. As a result of the latest formal valuation, a proposal was set out under which a monetary contribution or contributions will be made to enable the Trustee of the BPP to acquire an interest in a limited partnership. This partnership interest is intended to provide the Trustee with an income of at least £5m per annum in each year over a 15 year period together with a final payment of up to a maximum of £105m to the extent required under funding conditions to be agreed to the satisfaction of the Trustee and the company, at the end of the 15 year period.

As a result of the first tranche of the agreement, Britvic Scottish Limited Partnership (Britvic SLP) and Britvic Property Partnership (Britvic PP) were established by the group and properties with a market value of £28.6m were then transferred to Britvic PP and leased back to Britvic Soft Drinks Limited. Britvic SLP holds an investment in Britvic PP.

During 2012, BPP entered into a second tranche of the pension funding partnership structure. This tranche involved the sale and leaseback of certain group brands which were transferred to Britvic Brands LLP ('Britvic Brands') at a value of £72.4m and licensed back to Britvic Soft Drinks Limited. Britvic SLP holds an investment in Britvic Brands.

The BPP is a partner in Britvic SLP and is entitled to a share of the profits of the partnership over the next 15 years. At the end of this period, the partnership capital allocated to the BPP will be changed to an amount equal to any funding deficit of the BPP at that time, up to a maximum value of £105m. At that point the group may be required to transfer this amount in cash to the BPP.

Both Britvic SLP and Britvic PP are consolidated by the group. The investment held by the BPP in Britvic SLP does not represent a plan asset for accounting purposes and is therefore not included in the fair value of plan assets. The share of profits of Britvic SLP received by the BPP will be accounted for by the group as contributions when paid. The properties transferred to Britvic PP continue to be included within the group's property, plant and equipment on the balance sheet and the group retains operational flexibility over the transferred properties, including the ability to substitute the properties held by Britvic PP.

In addition to the expected partnership income of at least £5m per annum, the group will make payments to the BPP of £7.5m by 31 December 2012 and £15m per annum by 31 December of each year from 2013 to 2017.

The amount recognised as an expense in relation to the BPP defined contribution scheme in the income statement for 2012 was £10.3m (2011: £5.8m, 2010: £3.6m, 2009: £2.9m).

In Northern Ireland, the Britvic Northern Ireland Pension Plan (BNIPP) was closed to new members on 28 February 2006, and since this date new employees have been eligible to join a Stakeholder plan with Legal & General. Employees of C&C Group transferred out of BNIPP on 30 June 2008 with the bulk transfer of assets for the C&C employees taking place in December 2009. The latest formal actuarial valuation for contribution purposes was carried out as at 31 December 2008 and as a result shortfall correction additional contributions of £90,000 per month until 31 December 2010, and £125,000 per month from 1 January 2011 to 31 December 2019 are being paid in accordance with the Recovery Plan dated December 2009.

In relation to the Britvic Ireland Pension Plan ('BIPP'), during the year, the Trustee received approval from the Irish Pension Board for two significant changes to the BIPP, being the removal of the guaranteed annual 3% pension increase for pensions in payment and the introduction of a salary cap of €50k for future service accrual. As part of the changes, Britvic agreed to pay the cost on pension levy plan assets introduced by the Irish government in 2011. The removal of the guaranteed pension increase has resulted in the recognition of a past service gain of €25.2m (£21.3m) which has been recognised as an exceptional item. The changes significantly improve the funding position of the BIPP.

The amount recognised as an expense in relation to the Irish defined contribution schemes in the Income Statement for 2012 was £0.3m (2011: £0.6m, 2010: £0.4m, 2009: £0.3m).

All group pension schemes are administered by trustees who are independent of the group's finances.

The assets and liabilities of the pension schemes were valued on an IAS 19 basis at 30 September 2012 by Towers Watson (BPP) and Mercer (BIPP and BNIPP).

Included within the pension liability on the consolidated balance sheet is an accrual of £1.8m (2011: £1.4m, 2010: £1.1m) for retirement indemnities in respect of Britvic France. This liability is considered to be immaterial and no further disclosure is included within this note.

Principal Assumptions

Financial Assumptions

	2009 % ROI	2009 % NI	2009 % GB	2010 % ROI	2010 % NI	2010 % GB	2011 % ROI	2011 % NI	2011 % GB	2012 % ROI	2012 % NI	2012 % GB
Discount rate	5.75	5.50		5.65 4.90	5.00		5.05 5.35	5.20		5.60 4.20	4.70	4.85
Rate of compensation increase	3.30-3.80	4.50		4.40 3.00	4.50		4.50 3.00	4.00		n/a 3.00	3.60	n/a
Expected long
term return on plan assets	7.00	7.32		6.75 6.00	6.65		5.82 5.90	6.71		5.83 4.85	5.21	5.61
Pension
increases			3.00 2.30-3.40 2.25-3.30 3.00 2.30-3.40 2.30-3.40 3.00						3.00 2.30-3.40 0.00 1.65-2.05 1.80-2.75
Inflation
assumption	2.30	3.50		3.40 2.00	3.50		3.50 2.00	3.00		3.50 2.00	2.00	2.90

To develop the expected long term rate of return on assets assumption, the group considered the level of expected returns on risk free investments (primarily government bonds), the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns of each asset class. The expected return for each asset class was then weighted based on the target asset allocation to develop the expected long term rate on assets assumption for the portfolio.

Demographic assumptions

The most significant non-financial assumption is the assumed rate of longevity. This is based on standard actuarial tables, which for the BPP are known as SAPS Series 1. An allowance for future improvements in longevity has also been included. The following life expectancy assumptions have been used:

	2009 Years ROI	2009 Years NI	2009 Years GB	2010 Years ROI	2010 Years NI	2010 Years GB	2011 Years ROI	2011 Years NI	2011 Years GB	2012 Years ROI	2012 Years NI	2012 Years GB
Current pensioners (at age 65) – males	20.7	20.8	20.0	22.7	20.9	21.9	22.7	20.9	22.0	23.1	21.0	22.1
Current pensioners (at age 65) –
females	23.8	23.6	23.0	24.4	23.7	24.2	24.4	23.7	24.5	24.7	23.8	24.7
Future pensioners currently aged 45 (at
age 65) – males	21.8	22.6	21.2	25.6	22.6	24.1	25.6	22.7	24.2	25.8	22.8	24.3
Future pensioners currently aged 45 (at
age 65) – females	24.8	25.1	24.0	26.7	25.1	26.6	26.7	25.2	26.9	26.9	25.3	27.0

The mortality assumptions used to calculate the GB pension obligation were revised in 2010 following a mortality analysis carried out as part of the actuarial valuation of the Britvic Pension Plan at 31 March 2010.

Sensitivities

The value of plan assets is sensitive to market conditions, particularly equity values. Changes in assumptions used for determining retirement benefit costs and obligations may have a material impact on the income statement and balance sheet. The main assumptions are the discount rate, the rate of inflation and the assumed mortality rate. The following table provides an estimate of the potential impact of each of these variables on the principal pension plans.

Assumption	Change in	Impact on ROI	Impact on NI plan	Impact on GB
	assumption	plan liabilities	liabilities	plan liabilities
Discount rate	Increase/Decrease	Decrease/Increase	Decrease/Increase	Decrease/Increase
	by 0.1%	by £1.3m	by £0.5m	by £9.9m
Inflation rate	Increase/Decrease	Increase/Decrease	Increase/Decrease	Increase/Decrease
	by 0.1%	by £0.6m	by £0.2m	by £9.8m
Mortality rate	Increase in life expectancy by one year	Increase by £1.0m	Increase by £0.6m	Increase by £14.1m

Net benefit income / (expense)

ROI NI £m £m	GB £m	Total £m
Current service cost (0.9) (0.2)	–	(1.1)
Interest cost on benefit obligation (3.4) (1.3)	(26.5)	(31.2)
Expected return on plan assets 2.5 1.2	25.9	29.6
Curtailment gain 21.3 –	–	21.3
Net income / (expense) 19.5 (0.3)	(0.6)	18.6
ROI NI £m £m	GB £m	2011 Total £m
Current service cost (2.4) (0.3)	(2.6)	(5.3)
Interest cost on benefit obligation (3.6) (1.3)	(27.0)	(31.9)
Expected return on plan assets 2.8 1.3	27.0	31.1
Curtailment gain 1.2 –	17.7	18.9
Net income / (expense) (2.0) (0.3)	15.1	12.8

	ROI £m	NI £m	GB £m	2010 Total £m
Current service cost	(2.0)	(0.3)	(4.2)	(6.5)
Interest cost on benefit obligation	(3.0)	(1.3)	(26.3)	(30.6)
Expected return on plan assets	2.6	1.1	24.1	27.8
Curtailment gain	0.8	0.2	–	1.0
Net expense	(1.6)	(0.3)	(6.4)	(8.3)
	ROI £m	NI £m	GB £m	2009 Total £m
Current service cost	(2.2)	(0.3)	(3.5)	(6.0)
Interest cost on benefit obligation	(3.0)	(1.3)	(25.5)	(29.8)
Expected return on plan assets	2.3	1.0	26.2	29.5
Net expense	(2.9)	(0.6)	(2.8)	(6.3)

The net income detailed above is all recognised in arriving at net profit from continuing operations before tax and finance costs / income, and is included within cost of sales, selling and distribution costs and administration expenses.

The ROI curtailment gain in the year was triggered by the redundancies of employees resulting in a significant number of members moving from active to deferred status in the period, thereby no longer accruing future entitlement. The GB curtailment gain in the year arose due to the closure to future accrual of the defined benefit section of the GB plan.

Taken to the statement of comprehensive income

Actual return on scheme assets 6.4 2.4 55.6 64.4 Less: Expected return on scheme assets (2.5) (1.2) (25.9) (29.6) 3.9 1.2 29.7 34.8 Other actuarial gains (12.3) (0.4) (12.9) (25.6) Actuarial gains taken to the statement of comprehensive income (8.4) 0.8 16.8 9.2 2011 ROI NI GB Total £m £m £m £m Actual return on scheme assets (2.2) 0.7 5.9 4.4 Less: Expected return on scheme assets (2.8) (1.3) (27.0) (31.1) (5.0) (0.6) (21.1) (26.7) Other actuarial gains 8.8 2.2 60.8 71.8 Actuarial gains taken to the statement of comprehensive income 3.8 1.6 39.7 45.1 2010 ROI NI GB Total £m £m £m £m Actual return on scheme assets 4.3 1.5 49.2 55.0 Less: Expected return on scheme assets (2.6) (1.1) (24.1) (27.8) 1.7 0.4 25.1 27.2 Other actuarial losses (15.3) (2.4) (58.5) (76.2) Actuarial losses taken to the statement of comprehensive income (13.6) (2.0) (33.4) (49.0)	ROI £m	NI £m	GB £m	2012 Total £m

	ROI £m	NI £m	GB £m	2009 Total £m
Actual (loss) / return on scheme assets	(1.9)	2.2	26.4	26.7
Less: Expected return on scheme assets	(2.3)	(1.0)	(26.2)	(29.5)
	(4.2)	1.2	0.2	(2.8)
Other actuarial gains / (losses)	2.3	(2.8)	(68.7)	(69.2)
Actuarial losses taken to the statement of comprehensive income	(1.9)	(1.6)	(68.5)	(72.0)

Net (liability) / assets

Present value of benefit obligation Fair value of plan assets Net (liability) / assets	ROI £m (53.6) 47.2 (6.4)	NI £m (26.8) 23.8 (3.0)	GB £m (503.9) 511.4 7.5	2012 Total £m (584.3) 582.4 (1.9)
	ROI £m	NI £m	GB £m	2011 Total £m
Present value of benefit obligation Fair value of plan assets	(64.4) 44.5	(25.4) 20.3	(481.2) 462.5	(571.0) 527.3
Net liability	(19.9)	(5.1)	(18.7)	(43.7)
	ROI £m	NI £m	GB £m	2010 Total £m
Present value of benefit obligation	(69.6)	(26.8)	(544.6)	(641.0)
Fair value of plan assets Net liability	45.7 (23.9)	18.8 (8.0)	459.3 (85.3)	523.8 (117.2)
Recognised in the income statement	ROI £m	NI £m	GB £m	2009 Total £m
Present value of benefit obligation	(52.4)	(23.8)	(470.8)	(547.0)
Fair value of plan assets	34.0	16.2	411.7	461.9
Net liability	(18.4)	(7.6)	(59.1)	(85.1)

Movements in the present value of benefit obligation are as follows:

	ROI £m	NI £m	GB £m	2012 Total £m
At 2 October 2011	(64.4)	(25.4)	(481.2)	(571.0)
Exchange differences	4.7	–	–	4.7
Curtailment gain	21.3	–	–	21.3
Current service cost	(0.9)	(0.2)	–	(1.1)
Member contributions	(0.4)	–	–	(0.4)
Interest cost on benefit obligation	(3.4)	(1.3)	(26.5)	(31.2)
Benefits paid	1.8	0.5	16.7	19.0
Actuarial gains	(12.3)	(0.4)	(12.9)	(25.6)
At 30 September 2012	(53.6)	(26.8)	(503.9)	(584.3)

	ROI £m	NI £m	GB £m	2011 Total £m
At 3 October 2010	(69.6)	(26.8)	(544.6)	(641.0)
Exchange differences	0.8	–	–	0.8
Curtailment gain	1.2	–	17.7	18.9
Current service cost	(2.4)	(0.3)	(2.6)	(5.3)
Member contributions	(0.5)	–	(0.8)	(1.3)
Interest cost on benefit obligation	(3.6)	(1.3)	(27.0)	(31.9)
Benefits paid	0.9	0.8	15.3	17.0
Actuarial gains	8.8	2.2	60.8	71.8
At 2 October 2011	(64.4)	(25.4)	(481.2)	(571.0)
	ROI £m	NI £m	GB £m	2010 Total £m
At 27 September 2009	(52.4)	(23.8)	(470.8)	(547.0)
Exchange differences	2.6	–	–	2.6
Curtailment gain	0.8	0.2	–	1.0
Current service cost	(2.0)	(0.3)	(4.2)	(6.5)
Member contributions	(0.6)	–	(1.5)	(2.1)
Interest cost on benefit obligation	(3.0)	(1.3)	(26.3)	(30.6)
Benefits paid	0.3	0.8	16.7	17.8
Actuarial losses	(15.3)	(2.4)	(58.5)	(76.2)
At 3 October 2010	(69.6)	(26.8)	(544.6)	(641.0)
	ROI £m	NI £m	GB £m	2009 Total £m
At 28 September 2008	(42.5)	(20.0)	(385.9)	(448.4)
Exchange differences	(7.2)	–	–	(7.2)
Current service cost	(2.2)	(0.3)	(3.5)	(6.0)
Member contributions	(0.7)	–	(1.6)	(2.3)
Interest cost on benefit obligation	(3.0)	(1.3)	(25.5)	(29.8)
Benefits paid	0.9	0.6	14.4	15.9
Actuarial gains / (losses)	2.3	(2.8)	(68.7)	(69.2)
At 27 September 2009	(52.4)	(23.8)	(470.8)	(547.0)
Movements in the fair value of plan assets are as follows:

	ROI £m	NI £m	GB £m	2012 Total £m
At 2 October 2011	44.5	20.3	462.5	527.3
Exchange differences	(3.6)	–	–	(3.6)
Expected return on plan assets	2.5	1.2	25.9	29.6
Actuarial losses	3.9	1.2	29.7	34.8
Employer contributions	1.3	1.6	10.0	12.9
Member contributions	0.4	–	–	0.4
Benefits paid	(1.8)	(0.5)	(16.7)	(19.0)
At 30 September 2012	47.2	23.8	511.4	582.4
				2011
	ROI £m	NI £m	GB £m	Total £m
At 3 October 2010	45.7	18.8	459.3	523.8
Exchange differences	(0.6)	–	–	(0.6)
Expected return on plan assets	2.8	1.3	27.0	31.1
Actuarial losses Employer contributions	(5.0) 2.0	(0.6) 1.6	(21.1) 11.8	15.4
Member contributions	0.5	–	0.8	1.3
Benefits paid	(0.9)	(0.8)	(15.3)	(26.7) (17.0)

	ROI £m	NI £m	GB £m	2010 Total £m
At 27 September 2009	34.0	16.2	411.7	461.9
Exchange differences	(1.7)	–	–	(1.7)
Expected return on plan assets	2.6	1.1	24.1	27.8
Actuarial gains	1.7	0.4	25.1	27.2
Employer contributions	8.8	1.9	13.6	24.3
Member contributions	0.6	–	1.5	2.1
Benefits paid	(0.3)	(0.8)	(16.7)	(17.8)
At 3 October 2010	45.7	18.8	459.3	523.8
	ROI £m	NI £m	GB £m	2009 Total £m
At 28 September 2008	27.2	13.0	384.3	424.5
Exchange differences	4.6	–	–	4.6
Expected return on plan assets	2.3	1.0	26.2	29.5
Actuarial (losses) / gains	(4.2)	1.2	0.2	(2.8)
Employer contributions	4.3	1.6	13.8	19.7
Member contributions	0.7	–	1.6	2.3
Benefits paid	(0.9)	(0.6)	(14.4)	(15.9)

Categories of scheme assets as a percentage of the fair value of total scheme assets

	ROI £m	NI £m	GB £m	2012 Total £m	2012 Total %
Equities & real estate	28.4	11.7	271.5	311.6	54
Bonds and gilts	18.8	11.9	236.6	267.3	46
Cash	–	0.2	3.3	3.5	–
Total	47.2	23.8	511.4	582.4	100
	ROI £m	NI £m	GB £m	2011 Total £m	2011 Total %
Equities & real estate	28.0	9.5	243.5	281.0	53
Bonds and gilts	16.5	10.2	214.0	240.7	46
Cash	–	0.6	5.0	5.6	1
Total	44.5	20.3	462.5	527.3	100
	ROI £m	NI £m	GB £m	2010 Total £m	2010 Total %
Equities & real estate	30.6	15.4	260.2	306.2	59
Bonds and gilts	14.6	1.9	194.7	211.2	40
Cash	0.5	1.5	4.4	6.4	1
Total	45.7	18.8	459.3	523.8	100
	ROI £m	NI £m	GB £m	2009 Total £m	2009 Total %
Equities	24.2	12.5	236.8	273.5	59
Bonds and gilts	9.5	2.1	174.1	185.7	40
Cash	0.3	1.6	0.8	2.7	1
Total	34.0	16.2	411.7	461.9	100

Analysis of expected return on assets by categories of scheme assets

	ROI £m	NI £m	GB £m	2012 Total £m	2012 Total %
Equities & real estate	2.0	0.8	16.5	19.3	65
Bonds and gilts	0.5	0.3	9.2	10.0	34
Cash	–	0.1	0.2	0.3	1
Total	2.5	1.2	25.9	29.6	100
	ROI £m	NI £m	GB £m	2011 Total £m	2011 Total %
Equities & real estate	2.3	1.2	18.5	22.0	71
Bonds and gilts	0.5	0.1	8.3	8.9	29
Cash	–	–	0.2	0.2	–
Total	2.8	1.3	27.0	31.1	100
	ROI £m	NI £m	GB £m	2010 Total £m	2010 Total %
Equities & real estate	2.2	1.0	16.6	19.8	71
Bonds and gilts	0.4	0.1	7.5	8.0	29
Cash	–	–	–	–	–
Total	2.6	1.1	24.1	27.8	100
	ROI £m	NI £m	GB £m	2009 Total £m	2009 Total %
Equities	1.9	0.9	16.2	19.0	64
Bonds and gilts	0.2	0.1	10.0	10.3	35
Cash	0.2	–	–	0.2	1

History of experience gains and losses

	2007 £m	2008 £m	2009 £m	2010 £m	2011 £m	2012 £m
Fair value of schemes assets	479.3	424.5	461.9	523.8	527.3	582.4
Present value of defined benefit obligations	(484.9)	(448.4)	(547.0)	(641.0)	(571.0)	(584.3)
Deficit in the schemes	(5.6)	(23.9)	(85.1)	(117.2)	(43.7)	(1.9)
Experience adjustments arising on plan liabilities	(17.2)	3.3	2.0	36.7	1.5	–
Experience adjustments arising on plan assets	13.6	(98.9)	(2.7)	27.2	(26.7)	(34.8)

The cumulative amount of actuarial gains and losses recognised since 4 October 2004 in the group statement of comprehensive income is an overall loss of £49.2m (2011: loss of £58.4m, 2010: loss of £103.5m, 2009: loss of £54.5m). The Directors are unable to determine how much of the pension scheme deficit recognised on transition to IFRS and taken direct to equity of £1.3m is attributable to actuarial gains and losses since the inception of those pension schemes. Consequently, the Directors are unable to determine the amount of actuarial gains and losses that would have been recognised in the group statement of comprehensive income before 4 October 2004.

Normal contributions of £1.0m and additional contributions of £14.0m are expected to be paid into the pension schemes during the 2013 financial year

25. Trade and other payables (current)

2009 £m	2010 Restated* £m	2011 £m	2012 £m
			230.9
			8.5
			92.2
16.1	30.4	36.5	25.6
291.6	348.4	370.1	357.2
	187.0 19.9 68.6	231.9 11.3 74.8	235.9 8.7 89.0

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

Trade payables are non-interest bearing and are normally settled on 60 – 90 day terms

26. Financial risk management objectives and policies

Overview

The group's principal financial instruments comprise derivatives, borrowings and overdrafts, cash and cash equivalents. These financial instruments are used to manage interest rate and currency exposures, funding and liquidity requirements and share price exposure arising under the group's employee incentive schemes. Other financial instruments which arise directly from the group's operations include trade receivables and payables (see notes 19 and 25 respectively).

It is, and has always been, the group's policy that no derivative is entered into for trading or speculative purposes.

The main risks arising from the group's financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. Additionally, the group is exposed to commodity price risk and share price risk. The Board of Directors review and agree policies for managing these risks as summarised below.

Interest rate risk

The group's exposure to the risk of changes in market interest rates relates primarily to the group's long-term debt obligations with floating interest rates.

The group's policy is to manage its interest cost by maintaining a mix of fixed and variable rate debt. The group's policy is to have an average over the next three years of between 25% and 80% of its borrowings at fixed rates of interest. To manage this, the group enters into interest rate swaps, cross currency swaps and forward rate agreements which are designated to hedge underlying debt obligations. At 30 September 2012, after taking into account the effect of these instruments, approximately 86% of the group's borrowings are at a fixed rate of interest (2011: 82%, 2010: 63%, 2009: 62%).

Interest rate risk table

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the group's profit before tax (through the impact on floating rate borrowings) and equity for changes in the fair values of applicable derivative instruments.

	Increase / (decrease) in basis points	Effect on profit /loss before tax £m	Effect on equity £m
2012 Sterling	200 (200)	(0.2) 0.2	24.5 (27.6)
Euro	200 (200)	1.6 (1.8)	7.0 (8.4)
2011
Sterling	200	0.4	28.9
	(200)	(0.1)	(32.8)
Euro	200	3.5	6.8
	(200)	(2.3)	(8.2)
2010
Sterling	200	(0.9)	26.4
	(200)	0.9	(30.4)
Euro	200	2.3	8.5
	(200)	(3.1)	(10.5)
2009
Sterling	200	(2.1)	24.6
	(200)	2.1	(28.6)
Euro	200	(2.1)	–
	(200)	2.1	–

Foreign currency risk

Foreign currency risk is primarily in respect of exposure to fluctuations to the sterling-euro, sterling-US dollar and euro-US dollar rates of exchange. The group has operations in euro-denominated countries and finances these partly through the use of foreign currency borrowings and cross currency swaps which hedge the translation risk of net investments in foreign operations. Additionally cash generation from euro-denominated operations can be utilised to meet euro payment obligations in sterling denominated companies, providing a natural hedge.

The group also has transactional exposures arising from purchases of prime materials, capital expenditure and interest costs in currencies other than the functional currency of the individual group entities. Non functional currency purchases and interest costs are made in the currencies of US dollars and euros. As at 30 September 2012, the group has hedged 69% (2011: 67%, 2010: 68%, 2009: 48%) of forecast net exposures 12 months in advance using forward foreign exchange contracts.

Where funding is raised in a currency other than the currency ultimately required by the group, cross currency interest rate swaps are used to convert the cash flows to the required currency. These swaps have the same duration and other critical terms as the underlying borrowing.

The following table demonstrates the sensitivity to a reasonably possible change in the US dollar and euro exchange rates, with all other variables held constant, of the group's profit before tax (due to changes in the fair value of monetary assets and liabilities) and the group's equity (due to changes in fair value of forward exchange contracts).

	Increase / (decrease) in currency rate %	Effect on profit before tax £m	Effect on equity £m
2012
Sterling / euro	10	(0.6)	5.1
	(10)	0.6	(5.1)
Sterling / US dollar	10 (10)	– –	0.9 (0.9)
Euro / US dollar	10	–	0.9
	(10)	–	(0.9)
2011
Sterling / euro	10	(0.4)	5.0
	(10)	0.4	(5.0)
Sterling / US dollar	10	–	1.2
	(10)	–	(1.2)
Euro / US dollar	10	–	1.7
	(10)	–	(1.7)
2010
Sterling / euro	10	(0.1)	3.5
	(10)	0.1	(3.5)
Sterling / US dollar	10	(0.1)	0.7
	(10)	0.1	(0.7)
Euro / US dollar	10	–	1.4
	(10)	–	(1.4)
2009
Sterling / euro	10	(1.7)	2.4
	(10)	1.4	(2.2)
Sterling / US dollar	10	–	1.0
	(10)	–	(0.8)
Euro / US dollar	–	–	–
	–	–	–

Credit risk

The group trades only with recognised creditworthy third parties. It is the group's policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the group's exposure to bad debts is not significant. The maximum exposure is the carrying amount disclosed in note 19. For transactions that do not occur in the country of the relevant operating unit, the group does not offer credit terms without the approval of the Head of Finance Shared Services. There are no significant concentrations of credit risk within the group.

The group maintains a policy on counterparty credit exposures with banks and financial institutions arising from the use of derivatives and financial instruments. This policy restricts the investment of surplus funds and entering into derivatives to counterparties with a minimum credit rating maintained by either Moody's, Standard & Poors or Fitch. The level of exposure with counterparties at various ratings levels is also restricted under this policy. The level of exposure and the credit worthiness of the group's banking counterparties is reviewed regularly to ensure compliance with this policy.

Commodity price risk

The main commodity price risk arises in the purchases of prime materials, being PET, sugar, steel and frozen concentrated orange juice. Where it is considered commercially advantageous, the group enters into fixed price contracts with suppliers to hedge against unfavourable commodity price changes.

Share schemes equity price risk

The group operates several employee incentive share schemes. It has an exposure to the share price for the schemes in which shares are purchased in the market to satisfy the requirements of the plan. To hedge this risk the group has entered into a number of total return share swaps against schemes maturing in 2011, 2012 and 2013.

The following table demonstrates the sensitivity to a reasonably possible change in the Britvic plc share price, with all other variables held constant, of the group's profit before tax (due to changes in the fair value of the share swaps).

	Increase / (decrease) in share price %	Effect on profit before tax £m
2012	10 (10)	1.5 (1.5)
2011	10	1.9
	(10)	(1.9)
2010	10	2.2
	(10)	(2.2)

Liquidity risk

The group monitors its risk of a shortage of funds using rolling cash flow forecasts. These forecasts consider the maturity of both its financial investments and financial assets (e.g. accounts receivable, other financial assets) and projected cash flows from operations. The objective of the group's liquidity policy is to maintain a balance between continuity of funds and flexibility through the use of bank loans and overdrafts and long term private placement issuance. The bank loans entered into under the £400m bank facility are unsecured however £1.4m of outstanding Britvic France bank loans are secured. At 30 September 2012, £0.3m of the group's debt will mature in less than one year (2011: none, 2010: none, 2009: none).

The table below summarises the maturity profile of the group's financial liabilities at 30 September 2012 based on contractual undiscounted payments:

2012	Less than 1 year £m	1 to 5 years £m	> 5 years £m	Total £m
Secured bank loans	0.3	0.9	0.2	1.4
Private placement notes	27.4	331.2	320.1	678.7
Derivatives hedging private placement notes – payments	18.5	243.4	265.2	527.1
Derivatives hedging private placement notes – receipts	(24.8)	(271.6)	(286.3)	(582.7)
	21.1	303.0	299.0	623.1
Interest rate swap – payments	1.6	3.5	–	5.1
Interest rate swap – receipts	(0.8)	(1.5)	–	(2.3)
	0.8	2.0	–	2.8
Trade and other payables	324.3	–	–	324.3
Finance leases	0.3	0.5	–	0.8
Other financial liabilities	4.4	–	–	4.4
	351.2	306.4	299.2	956.8

2011	Less than 1 year £m	1 to 5 years £m	> 5 years £m	Total £m
Unsecured bank loans	0.1	2.7	–	2.8
Private placement notes Derivatives hedging private placement notes – payments Derivatives hedging private placement notes – receipts	27.9 19.8 (25.3) 22.4	206.8 140.6 (161.7) 185.7	486.7 413.2 (425.0) 474.9	721.4 573.6 (612.0) 683.0
Interest rate swap – payments Interest rate swap – receipts	1.7 (1.4) 0.3	5.5 (4.3) 1.2	– – –	7.2 (5.7) 1.5
Trade and other payables Finance leases Other financial liabilities	333.6 – 4.3 360.7	– 1.2 – 190.8	– – – 474.9	333.6 1.2 4.3 1,026.4
2010 Unsecured bank loans	Less than 1 year £m 3.8	1 to 5 years £m 128.1	> 5 years £m –	Total £m 131.9
Private placement notes Derivatives hedging private placement notes – payments Derivatives hedging private placement notes – receipts	23.6 16.7 (23.3) 17.0	195.3 139.6 (179.4) 155.5	375.4 431.9 (483.7) 323.6	594.3 588.2 (686.4) 496.1
Interest rate swap – payments Interest rate swap – receipts	0.7 (0.4) 0.3	5.9 (3.1) 2.8	0.7 (0.4) 0.3	7.3 (3.9) 3.4
Trade and other payables Finance leases Other financial liabilities	318.0* – 1.4 340.5	– 0.7 – 287.1	– 0.8 – 324.7	318.0 1.5 1.4 952.3
2009 Unsecured bank loans	Less than 1 year £m 2.8	1 to 5 years £m 183.0	> 5 years £m –	Total £m 185.8
Private placement notes Derivatives hedging private placement notes – payments Derivatives hedging private placement notes – receipts	15.7 11.5 (13.4) 13.8	149.5 (116.0) 129.6	222.5 96.1 167.1 (206.1) 183.5	387.7 274.7 (335.5) 326.9
Trade and other payables Other financial liabilities	275.5 0.4 292.5	312.6	– – – – 183.5	275.5 0.4 788.6

* Restated following the finalisation of the fair value allocation of Britvic France, acquired on 28 May 2010.

In respect of the private placement notes, the periods when the cash flows are expected to occur (as shown by the tables above) and when they are expected to affect the income statement are the same.

Details with regard to derivative contracts are included in note 27.

All bank loans at year end were secured loans from inception.

Fair value hierarchy

The group uses the following valuation hierarchy to determine the carrying value of financial instruments that are measured at fair value:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.

2012 £m Level 1 – Level 2 – Derivatives used for hedging 92.2 – Financial instruments at fair value through profit or loss – Level 3 – Total 92.2 Assets 2011 £m Level 1 – Level 2	Liabilities £m
	–
	(6.9)
	(8.4)
	–
	(15.3)
	Liabilities £m
	–
– Derivatives used for hedging 95.9	(2.7)
– Financial instruments at fair value through profit or loss –	(11.3)
Level 3 –	–
Total 95.9	(14.0)
Assets 2010 £m	Liabilities £m
Level 1 –	–
Level 2
– Derivatives used for hedging 82.0	(4.3)
– Financial instruments at fair value through profit or loss 0.1 Level 3 –	(0.9) –
Total 82.1	(5.2)
Assets	Liabilities
2009 £000	£000
Level 1 – Level 2	–
– Derivatives used for hedging 53.7	(0.4)
Level 3 –	–
Total 53.7	(0.4)

Capital management

The group defines 'capital' as being net debt plus equity.

The group's objectives when managing capital are to safeguard the group's ability to continue as a going concern and maintain an appropriate capital structure to balance the needs of the group to grow, whilst operating with sufficient headroom within its bank covenants.

The group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the group has a number of options available to it including modifying dividend payments to shareholders, returning capital to shareholders or issuing new shares. In this way, the group balances returns to shareholders between long term growth and current returns whilst maintaining capital discipline in relation to investing activities and taking any necessary action on costs to respond to the current environment.

The group monitors capital on the basis of the adjusted net debt / EBITDA ratio. Adjusted net debt is calculated as being the net of cash and cash equivalents, interest bearing loans and borrowings and the element of the fair value of interest rate currency swaps hedging the balance sheet value of the US private placement Notes. Adjusted net debt is shown in note 30. The adjusted net debt / EBITDA ratio enables the group to plan its capital requirements in the medium term. The group uses this measure to provide useful information to financial institutions and investors. The group believes that an adjusted net debt / EBITDA ratio in the range of 2.0 – 3.0 provides an efficient capital structure and an appropriate level of financial flexibility. At 30 September 2012 the adjusted net debt / EBITDA ratio was 2.8 (2011: 2.4, 2010: 2.4, 2009: 2.4).

27. Derivatives and hedge relationships

Fair values of financial assets and financial liabilities

Set out below is a comparison by category of carrying amounts and fair values of all of the group's financial instruments, except trade and other receivables and payables.

	Book value 2009 £m	Fair value 2009 £m	Book value 2010 £m	Fair value 2010 £m	Book value 2011 £m	Fair value 2011 £m	Book value 2012 £m	Fair value 2012 £m
Financial assets
Cash Cross currency	39.7	39.7	54.0	54.0	43.0	43.0	49.5	49.5
interest rate
swaps*	51.9	51.9	81.3	81.3	93.0	93.0	92.1	92.1
Share swaps* Favourable contracts recognised on the acquisition of	–	–	0.1	0.1	–	–	–	–
Britvic France** Forward currency	–	–	0.3	0.3	–	–	–	–
contracts**	1.8	1.8	0.7	0.7	1.8	1.8	0.1	0.1
Foreign exchange swaps**			–	–	1.1	1.1	–	–
	93.4	93.4	136.4	136.4	138.9	138.9	141.7	141.7
Financial liabilities Interest-bearing loans and borrowings (bank loans and private placement notes):
Fixed rate
borrowings	–	–	(433.5)	(481.2)	(563.4)	(616.7)	(549.2)	(598.9)
Floating rate borrowings	(264.6)	(272.7)	(134.9)	(134.9)	(8.6)	(8.6)	(9.3)	(9.3)
Bank overdrafts							(1.9)	(1.9)
Finance leases Forward currency	(186.1)	(186.1)	(1.5)	(1.5)	(1.2)	(1.2)	(0.8)	(0.8)
contracts***	(0.4)	(0.4)	(1.3)	(1.3)	(0.3)	(0.3)	(1.9)	(1.9)
FX swaps contracts Unfavourable contracts recognised on the acquisition of							(0.2)	(0.2)
Britvic France*** Cross currency	–	–	(0.1)	(0.1)	–	–	–	–
interest rate swaps****	–	–	(3.0)	(3.0)	(2.4)	(2.4)	(5.0)	(5.0)
Interest rate swaps****	–	–	(0.9)	(0.9)	(1.4)	(1.4)	(3.5)	(3.5)
Forward rate
agreements***	–	–	–	–	(0.1)	(0.1)	–	–
Share swaps***	–	–	–	–	(3.9)	(3.9)	(2.3)	(2.3)
Share swaps****	–	–	–	–	(5.9)	(5.9)	(2.4)	(2.4)
	(451.1)	(459.2)	(575.2)	(622.9)	(587.2)	(640.5)	(576.5)	(626.2)

* Included within 'Non-current assets: Other financial assets' on the consolidated balance sheet

** Included within 'Current assets: Other financial assets' on the consolidated balance sheet

*** Included within 'Current liabilities: Other financial liabilities' on the consolidated balance sheet

****Included within 'Non-current liabilities: Other financial liabilities' on the consolidated balance sheet

Non-derivative financial assets are categorised as loans and receivables as defined in IAS 39 'Financial instruments – recognition and measurement'. Non-derivative financial liabilities are all carried at amortised cost.

The fair value of derivatives, which are quoted at market price, has been calculated by discounting the expected future cash flows at prevailing interest rates.

The fair value of the current trade and other receivables and payables approximate to book value.

The fair value of fixed rate borrowings has been derived from the sum of future cash flows to maturity discounted back to present values at a market rate.

Derivatives not designated as part of hedge relationships

Interest rate swaps

The 2009 USPP cross currency swaps converted an amount of US dollar borrowings into a €147.0m floating rate euro liability. To mitigate exposure to changes in euro interest rates on this liability, €75.0m of interest rate swaps were transacted. These 5-year fixed rate swaps had an effective start date of December 2010.

From the 2010 USPP issuance an amount of \$55m was swapped into £35.6m of floating rate sterling liability. To mitigate exposure for a proportion of this liability, £20m of 3-year interest rate swaps were transacted with an effective date of December 2011.

Forward rate agreement

To mitigate exposure to floating interest rates at the next interest rate fixing on the remaining €72m of 2009 floating rate euro liability, a series of forward rate agreements with a notional totalling €30m were transacted with an effective date of December 2012.

Share swaps

The group operates several employee incentive share schemes. It has an exposure to the share price for the schemes in which shares are purchased in the market to satisfy the requirements of the plan. To hedge this risk the group has entered into a number of total return share swaps against schemes maturing in 2011, 2012 and 2013.

Foreign exchange swaps

As part of operational cash management €83m of euro / sterling FX swaps were in existence at 30 September 2012.

Hedging activities

The group has a number of derivative contracts which are designated as part of effective hedge relationships. These are included in other financial assets and liabilities as follows:

	2009 £m	2010 £m	2011 £m	2012 £m
Consolidated balance sheet
Non-current assets: Other financial assets
Fair value of the 2007 cross currency interest rate swaps1	51.9	58.0	61.6	49.9
Fair value of the 2009 USD GBP cross currency interest rate swaps3	–	23.3	29.6	27.1
Fair value of the 2009 GBP euro cross currency interest rate swaps2	–	–	0.6	11.1
Fair value of the 2010 USD GBP cross currency floating interest rate swaps3	–	–	1.2	1.6
Fair value of the 2010 GBP euro cross currency fixed interest rate swaps	–	–	–	2.4
Current assets: Other financial assets
Fair value of forward currency contracts1	1.8	0.7	1.8	0.1
Fair value of foreign exchange swaps	–	–	1.1	–
Current liabilities: Other financial liabilities
Fair value of forward currency contracts1	(0.4)	(1.3)	(0.3)	(1.9)
Fair value of share swaps	–	–	(3.9)	(2.3)

	2009 £m	2010 £m	2011 £m	2012 £m
Fair value of forward rate agreements	–	–	(0.1)	–
Fair value of foreign exchange swaps	–	–	–	(0.2)
Non-current liabilities: Other financial liabilities
Fair value of the 2009 GBP euro cross currency interest rate swaps2	–	(0.4)	–	–
Fair value of the 2010 GBP euro cross currency interest rate swaps2	–	(1.2)	(1.1)	–
Fair value of the 2010 USD GBP cross currency floating interest rate swaps3	–	(0.7)	–	–
Fair value of the 2010 USD GBP cross currency fixed interest rate swaps1	–	(0.7)	(1.3)	(5.0)
Fair value of share swaps	–	–	(5.9)	(2.4)
Fair value of interest rate swaps	–	(0.9)	(1.4)	(3.5)

¹ Instruments designated as part of a cash flow hedge relationship

² Instruments designated as part of a net investment hedge relationship

³ Instruments designated as part of a fair value hedge relationship

As at the 30 September 2012 these hedging relationships are categorised as follows:

Cash flow hedges

Forward currency contracts

At 30 September 2012, the group held 68 (2011: 72, 2010: 60, 2009: 44) US dollar and 38 (2011: 51, 2010: 30, 2009: 67) euro forward exchange contracts (the 'forward currency contracts') designated as hedges of expected future purchases from suppliers in US dollars and euros which the group believe to be highly probable transactions. The forward currency contracts are being used to hedge the foreign currency risk of these highly probable transactions.

The forward currency contracts hedge the expected future purchases in the period to 30 September 2013 and have been assessed as part of effective cash flow hedge relationships. At the period end there is a net unrealised loss of £1.8m (2011: net unrealised gain of £1.5m, 2010: net unrealised loss of £0.6m, 2009: net unrealised gain of £1.3m), with a related deferred tax liability of £0.4m (2011: related deferred tax liability of £0.4m, 2010: related deferred tax asset of £0.1m, 2009: related deferred tax liability of £0.4m), which has been included in equity in respect of these contacts.

The terms of these forward contracts are detailed in the table below

Forward contracts to hedge expected future purchases	Maturity range	Average exchange rate
2012
£ / US\$13.8m	Oct 12 to Sep 13	\$1.57 / £
£ / €64.3m	Oct 12 to Sep 13	€1.22 / £
€ / US\$14.0m	Oct 12 to Mar 13	\$1.27 / €
2011
£ / US\$19.4m	Oct 11 to Jul 12	£ / US\$1.62
£ / € 57.5m	Oct 11 to Aug 12	£ / €1.16
€ / US\$26.8m	Oct 11 to Sept 12	€ / US\$1.43
2010
£ / US\$10.3m	Oct 10 to Sept 11	£ / US\$1.54
£ / €40.2m	Oct 10 to Jul 11	£ / €1.15
€ / US\$21.3m	Oct 10 to Sept 11	€ / US\$1.31
2009
£ / US\$14.1m	Sept 09 to Aug 10	£ / US\$1.57
£ / €26.5m	Sept 09 to Aug 10	£ / €1.17

Cross currency interest rate swaps

2007 Notes / 2007 cross currency interest rate swaps

The group continues to have a number of cross currency interest rate swaps relating to the 2007 Notes. These cross currency interest rate swaps (the '2007 cross currency interest rate swaps') have the effect of fixing the borrowings into sterling and the rate of interest payable on the 2007 Notes. The 2007 cross currency interest rate swap instruments have the same duration and other critical terms as the 2007 Notes and continue to be designated as part of a cash flow hedge relationship with the 2007 Notes. This has been assessed to be a highly effective relationship as at 30 September 2012. The fair value of the 2007 cross currency interest rate swap instruments at 30 September 2012, included within 'Non-current assets: Other financial assets' on the balance sheet, was £49.9m (2011: £61.6m, 2010: £58.0m, 2009: £51.9m). The movement in the fair value has been taken to Consolidated Statement of Comprehensive Income. A total gain of £8.7m (2011: £3.6m loss, 2010: £1.9m, 2009: £31.6m) has been recycled to the Consolidated Income Statement to match the foreign exchange movement on the 2007 Notes. Within equity there is a net unrealised gain of £8.4m (2011: net unrealised gain of £11.4m, 2010: net unrealised gain of £11.4m, 2009: net unrealised gain of £7.3m) with a related deferred tax liability of £1.9m (2011: deferred tax liability of £2.9m, 2010: deferred tax liability of £3.1m, 2009: deferred tax liability of £2.1m) in respect of the 2007 cross currency interest rate swap instruments.

2010 Notes / 2010 USD GBP cross currency fixed interest rate swaps

The group continues to have a number of cross currency interest rate swaps relating to the 2010 Notes. These instruments swap the principal and interest from US dollar into sterling (the '2010 USD GBP cross currency fixed interest rate swaps'). The 2010 USD GBP cross currency interest rate swaps which swap interest from fixed US dollar to fixed sterling are designated as part of a cash flow hedge relationship with the future cash flows associated with the 2010 Notes. This has been assessed to be a highly effective relationship as at 30 September 2012. The fair value of these instruments at 30 September 2012, included within 'Non-current liabilities: Other financial liabilities' on the balance sheet, was £5.0m (2 October 2011: £1.3m, 3 October 2010: £0.7m, 27 September 2009: £0.4m) The movement in fair value has been taken to consolidated statement of comprehensive income. A total loss of £2.5m (2 October 2011: £0.7m, 3 October 2010: £nil) has been recycled to the Consolidated Income Statement to match the foreign exchange movement on the 2010 Notes. Within equity there is a net unrealised loss of £1.9m (2 October 2011: net unrealised loss of £0.7m, 3 October 2010: net unrealised loss of £0.7m) with a related deferred tax asset of £0.4m (2 October 2011: deferred tax asset of £0.2m, 3 October 2010: deferred tax asset of £0.2m) in respect of the 2010 cross currency interest rate swap instruments.

Fair value hedges

2009 Notes / 2009 USD GBP cross currency interest rate swaps

The group continues to have a number of cross currency interest rate swaps in respect of the 2009 Notes. These instruments swap the principal and interest from fixed US dollar into floating sterling (the '2009 USD GBP cross currency interest rate swaps'). The 2009 USD GBP cross currency interest rate swaps are designated as part of a fair value hedge relationship with the 2009 Notes. The fair value movements on the 2009 USD GBP cross currency interest rate instruments are recorded in the Consolidated Income Statement, as is the fair value movement in the 2009 Notes. The 2009 USD GBP cross currency interest rate swap contracts have the same duration and other critical terms as the 2009 Notes they hedge. The 2009 USD GBP cross currency interest rate swaps have been assessed as part of a highly effective hedge relationship as at 30 September 2012. The fair value of the swap instruments at 30 September 2012, included within 'Non-current assets: Other financial assets' on the Consolidated Balance Sheet, was £27.1m (2 October 2011: £29.6m, 3 October 2010: £23.3m).

2010 Notes / 2010 USD GBP cross currency floating interest rate swaps

The group has entered into swap instruments which swap the principal and fixed rate interest of the 2010 Notes to floating sterling ('2010 USD GBP cross currency floating interest rate swaps'). These instruments are designated as part of a fair value hedge relationship with the 2010 Notes. The fair value movements on the 2010 USD GBP cross currency floating interest rate swaps are recorded in the Consolidated Income Statement, as is the fair value movement of the hedged item. The swap contracts have the same duration and other critical terms as the 2010 Notes they hedge. The 2010 USD GBP cross currency floating interest rate swaps have been assessed as part of a highly effective hedge relationship as at 30 September 2012. The fair value of the swap instruments at 30 September 2012, included within 'Non-current assets: Other financial assets' on the Consolidated Balance Sheet, was £1.6m (2 October 2011: Non-current assets: Other financial assets £1.2m, 3 October 2010: Non-current liabilities: Other financial liabilities £0.7m).

Net investment hedges

2009 GBP euro cross currency interest rate swaps

These instruments swap floating sterling liabilities into floating euro liabilities. They have been designated as part of an effective hedge of the net investment in Britvic Ireland. The 2009 GBP euro cross currency interest rate swaps, along with the underlying loan instruments, are being used to hedge the group's exposure to foreign exchange risk on this euro investment. Movements in the fair value of the 2009 GBP euro cross currency interest rate swaps are taken to equity where they offset foreign exchange movements on the translation of the net investment in Britvic Ireland. The fair value of the 2009 GBP euro cross currency interest rate swaps at 30 September 2012 is an asset of £11.1m (2 October 2011: asset of £0.6m, 3 October 2010: liability of £0.4m) included within 'Non-current assets: Other financial assets' on the Consolidated Balance Sheet (2010: included within 'Non-current liabilities: Other financial liabilities').

2010 GBP euro cross currency interest rate swaps

These instruments swap fixed sterling liabilities into fixed euro liabilities and have been designated as part of an effective hedge of the net investment in Britvic France. The 2010 GBP euro cross currency interest rate swaps, along with the underlying loan instruments, are being used to hedge the group's exposure to foreign exchange risk on this euro investment. Movements in the fair value of the 2010 GBP euro cross currency interest rate swaps are taken to equity where they offset foreign exchange movements on the translation of the net investment in Britvic France. The fair value of the 2010 GBP euro cross currency interest rate swaps at 30 September 2012 is an asset of £2.4m (2 October 2011: liability of £1.1m, 3 October 2010: liability of £1.2m) included within 'Noncurrent liabilities: Other financial liabilities' on the Consolidated Balance Sheet.

The impact on the consolidated statement of comprehensive income of the derivatives and hedge relationships described above is summarised in the table below.

	2009 £m	2010 £m	2011 £m	2012 £m
Consolidated statement of comprehensive income
Amounts recycled to the income statement in respect of cash flow hedges
Forward currency contracts*	(3.0)	(1.1)	(0.7)	(1.7)
2007 cross currency interest rate swaps**	(31.6)	(1.9)	(3.6)	8.7
2010 cross currency interest rate swaps**		–	0.6	2.5
	(34.6)	(3.0)	(3.7)	9.5
Gains/(losses) in the period in respect of cash flow hedges
Forward currency contracts	4.1	(0.9)	2.8	(1.6)
2007 cross currency interest rate swaps	29.7	6.1	3.6	(11.7)
2010 cross currency interest rate swaps	–	(0.7)	(0.6)	(3.7)
	33.8	4.5	5.8	(17.0)
Exchange differences on translation of foreign operations
Movement on 2009 GBP euro cross currency interest rate swaps	–	(0.4)	1.0	10.5
Movement on 2010 GBP euro cross currency interest rate swaps	–	(1.2)	0.1	3.5
Exchange movements on translation of the euro net investment	17.1	(12.1)	(2.7)	(17.9)
	17.1	(13.7)	(1.6)	(3.9)
Offsetting amounts recorded in cost of sales * Offsetting amounts recorded in finance costs

28. Other non-current liabilities

	2009	2010	2011	2012
	£m	£m	£m	£m
Firm Commitment	–	4.2	1.9	1.9

A firm commitment exists in respect of the receipt of the 2009 and 2010 Notes.

29. Share-based payments

The income recognised for share-based payments in respect of employee services received during the 52 weeks ended 30 September 2012, including national insurance of £0.4m (2011: expense £0.5m, 2010: expense £0.9m, 2009: expense £0.5m) and dividend equivalents of £1.0m (2011: £0.4m, 2010: £0.7m, 2009: £0.3m), is £3.0m (2011: £4.7m, 2010: £9.4m, 2009: £7.7m). This expense arises from transactions which are expected to be equity-settled share-based payment transactions.

The Britvic Share Incentive Plan ("SIP")

The SIP is an all-employee plan approved by HMRC. The plan allows for annual awards of free ordinary shares with a value of 3% of salary (subject to HMRC maximum limits) together with an offer of matching shares on the basis of one free matching share for each ordinary share purchased with a participant's savings, up to a maximum of £50 (2011: £75) per four week pay period. Employees are entitled to receive the annual free share award provided they are employed by the company on the last day of each financial year and on the award date. There are no cash settlement alternatives.

Awards made during the period are shown in the table below. The fair value of these awards is equivalent to the intrinsic value of the shares.

	No of shares
	2009	2010	2011	2012
Annual free shares award	675,573	406,083	484,343	–
Matching shares award – 1 free share for every ordinary share purchased	464,205	287,132	346,267	281,662

The Britvic Executive Share Option Plan ("Option Plan")

The Option Plan allows for options to buy ordinary shares to be granted to selected employees. The option price is the average market price of Britvic plc's shares on the three business days before the date of grant. Options become exercisable on the satisfaction of the performance condition and remain exercisable until ten years after the date of grant.

The performance condition requires average growth in EPS of 7% pa over a three year period in excess of the average growth in RPI over the same period for the options to vest in full. If EPS growth averages 3% per annum in excess of RPI growth, 25% (2011: 25%, 2010: 25%, 2009: 25%) of the options will vest. Straight-line apportionment will be applied between these two levels to determine the number of options that vest and no options will vest if average EPS growth is below the lower threshold.

In some circumstances, at the discretion of the company, an option holder who exercises his/her option may receive a cash payment rather than the Ordinary shares under option. The cash payment would be equal to the amount by which the market value of the ordinary shares under option exceeds the option price. However, it is expected that this plan will be equity-settled and as a consequence has been accounted for as such.

The following table illustrates the movements in the number of share options during the period.

	Number of share options	Weighted average exercise price (pence)
Outstanding as at 28 September 2008	4,157,542	273.7
Granted during the period	2,978,518	221.0
Exercised during the period	(37,201)	245.0
Forfeited during the period	(534,329)	250.7
Outstanding as at 27 September 2009	6,564,530	251.8
Granted during the period	1,785,576	387.0
Exercised during the period	(639,946)	245.0
Forfeited during the period	(162,077)	285.1
Outstanding as at 3 October 2010	7,548,083	283.7
Granted during the period	1,566,418	464.6
Exercised during the period	(209,531)	265.8
Forfeited during the period	(140,584)	392.4
Outstanding as at 2 October 2011	8,764,386	314.8
Granted during the period	2,175,767	331.6
Exercised during the period	(244,499)	233.1
Forfeited during the period	(246,138)	406.4
Lapsed during the period	(9,496)	347.0
Outstanding at 30 September 2012	10,440,020	318.0
Exercisable at 30 September 2012	4,659,273	258.1

The weighted average share price at the date of exercise for share options exercised during the period was 362.2p (2011: 459.3p, 2010: 412.7p, 2009: 317.1p).

The share options outstanding as at 30 September 2012 had a weighted average remaining contractual life of 6.7 years (2011: 7.1 years, 2010: 7.6 years, 2009: 8.0 years) and the range of exercise prices was 221.0p – 464.6p (2011: 221.0p – 464.6p, 2010: 221.0p – 387.0p, 2009: 221.0p – 347.0p).

The weighted average fair value of options granted during the period was 58.2p (2011: 82.8p, 2010: 81.6p, 2009: 52.3p).

The fair value of equity-settled share options granted is estimated as at the date of grant using a binomial model, taking account of the terms and conditions upon which the options were granted.

The following table lists the inputs to the model used in respect of the award granted during the 52 weeks ended 30 September 2012. The comparative shows the inputs to the model used in respect of the award granted during the 52 weeks ended 2 October 2011, 53 weeks ended 3 October 2010, and 52 weeks ended 27 September 2009.

2011 2012
4.8 3.6
27.5 27.9
0.8 1.9
5.0 5.0
329.8 475.0
464.6 331.6

The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily be the actual outcome.

The Britvic Performance Share Plan ("PSP")

The PSP allows for awards of ordinary shares or nil cost options to be made to selected employees with vesting subject to the satisfaction of a performance condition. Different performance conditions apply to different groups of employees. Awards up to and including 2008 were made in respect of ordinary shares. Awards granted in 2009 and 2010 were made in respect of nil cost options. Nil cost options become exercisable on the satisfaction of the performance conditions and remain exercisable until 10 years / 7 years after the date of grant for employees based in the UK / Ireland respectively.

The performance condition applying to the total number of awards granted to members of the senior leadership team during the current period is divided equally between the total shareholder return ("TSR") and return on invested capital ("ROIC") performance conditions described below.

The TSR condition measures the company's TSR relative to a comparator group (consisting of 18 companies) over a three year performance period. The awards will not vest unless the company's position in the comparator group is at least median. At median 25% (2011: 25%, 2010: 25%, 2009: 25%) will vest, rising on a straight-line basis to 100% vesting at upper quartile.

For the award granted during the 52 weeks ended 30 September 2012, the ROIC performance condition requires the company's ROIC to be at least 22.3% (2011: for the award granted during the 52 weeks ended 2 October 2011, 22.7%, 2010: for the award granted during the 53 weeks ended 3 October 2010, 23.2%; 2009: for the award granted during the 52 weeks ending 27 September 2009, 18.8%) over the three year performance period for the award to vest in full. If ROIC is 21.5% (2011: 21.9%, 2010: 21.9%, 2009: 16.8%) over the performance period, 25% (2011: 25%, 2010: 25%, 2009: 25%) of the award will vest. Straight-line apportionment will be applied between these two levels to determine the percentage of awards that vest and no awards will vest if ROIC is below the lower threshold.

Awards granted to members of the senior management team vest subject to a performance condition which requires average growth in EPS of 7% pa over a three year period in excess of the growth in RPI over the same period for the awards to vest in full. If EPS growth averages 3% pa in excess of RPI growth, 25% (2011: 25%, 2010: 25%, 2009: 25%) of the awards will vest. Straight-line apportionment will be applied between these two levels to determine the number of awards that vest and no awards will vest if average EPS growth is below the lower threshold.

In some circumstances, at the discretion of the company, vested awards may be satisfied by a cash payment rather than a transfer of ordinary shares. However, it is expected that this plan will be equity-settled and as a consequence has been accounted for as such.

The following tables illustrate the movements in the number of shares and nil cost options during the period.

	Number of Shares subject to TSR condition	Number of Shares subject to EPS condition	Number of Shares subject to ROIC condition
Outstanding as at 28 September 2008	1,801,997	1,624,451	860,105
Granted during the period	680,874	1,389,503	680,873
Vested during the period*	(391,887)	(445,730)	(860,105)
Lapsed during the period	(374,360)	(231,363)	(60,282)
Outstanding as at 27 September 2009	1,716,624	2,336,861	620,591
Vested during the period*	(625,594)	(489,791)	–
Lapsed during the period	(38,041)	(191,019)	(28,919)
Outstanding as at 3 October 2010	1,052,989	1,656,051	591,672
Granted during the period	–	10,575	–
Vested during the period*	(460,963)	(463,228)	–
Lapsed during the period	(7,245)	(107,970)	(6,893)
Outstanding as at 2 October 2011	584,781	1,095,428	584,779
Granted during the period	–	14,997	–
Vested during the period*	(532,156)	(916,249)	(532,157)
Lapsed during the period	–	–	–
Outstanding at 30 September 2012	52,625	194,176	52,622

* The share price on the date of vesting was 329.8p (2011: 462.0p, 2010: 370.6p, 2009: 228.0p).

	Number of nil cost options subject to TSR condition	Number of nil cost options subject to EPS condition	Number of nil cost options subject to ROIC condition
Outstanding as at 27 September 2009	–	–	–
Granted during the period	396,578	816,207	396,578
Forfeited during the period	–	(69,349)	–
Outstanding at 3 October 2010	396,578	746,858	396,578
Granted during the period	353,423	749,543	353,423
Forfeited during the period	(50,723)	(154,376)	(50,723)
Outstanding at 2 October 2011	699,278	1,342,025	699,278
Granted during the period	481,128	1,001,479	481,128
Forfeited during the period	(62,591)	(313,138)	(62,591)
Outstanding at 30 September 2012	1,117,815	2,030,366	1,117,815

There were no nil cost options exercisable at 30 September 2012 (2011: Nil, 2010: Nil).

The nil cost options outstanding as at 30 September 2012 had a weighted average remaining contracted life of 8.2 years (TSR condition) (2011: 8.5 years, 2010: 9.0 years), 8.0 years (EPS condition) (2011: 8.4 years, 2010: 8.7 years) and 8.2 years (ROIC condition) (2011: 8.5 years, 2010: 9.0 years).

The weighted average fair value of nil cost options granted during the period was 194.2p (TSR condition) (2011: 258.6p, 2010: 208.5p, 2009: 121.6p), 323.0p (EPS condition) (2011: 413.0p, 2010: 336.3p, 2009: 197.7p) and 322.7p (ROIC condition) (2011: 413.0p, 2010: 336.3p, 2009: 197.7p).

The fair value of equity-settled shares and nil cost options granted is estimated as at the date of grant using separate models as detailed below, taking account of the terms and conditions upon which the shares and nil cost options were granted.

The following table lists the inputs to the models used in respect of the award granted during the 52 weeks ended 30 September 2012.

	Nil cost options subject to TSR condition	Nil cost options subject to EPS condition	Nil cost options subject to ROIC condition
		Share price at date of grant adjusted for dividends not received	Share price at date of grant adjusted for dividends not received
Valuation model used	Monte Carlo simulation	during vesting period	during vesting period
Dividend yield (%)	3.6	3.6	3.6
Expected volatility (%)	27.9	N/A	N/A
Share price at date of grant (pence)	329.8	329.8	329.8

The following table lists the inputs to the models used in respect of the award granted during the 52 weeks ended 2 October 2011.

	Nil cost options subject to TSR condition	Nil cost options subject to EPS condition	Nil cost options subject to ROIC condition
		Share price at date of grant adjusted for	Share price at date of grant adjusted for
		dividends not received	dividends not received
Valuation model used	Monte Carlo simulation	during vesting period	during vesting period
Dividend yield (%)	4.8	4.8	4.8
Expected volatility (%)	27.5	N/A	N/A
Share price at date of grant (pence)	475.0	475.0	475.0

The following table lists the inputs to the models used in respect of the award granted during the 53 weeks ended 3 October 2010.

	Nil cost options subject to TSR condition	Nil cost options subject to EPS condition	Nil cost options subject to ROIC condition
		Share price at date of grant adjusted for	Share price at date of grant adjusted for
		dividends not received	dividends not received
Valuation model used	Monte Carlo simulation	during vesting period	during vesting period
Dividend yield (%)	4.2	4.2	4.2
Expected volatility (%)	32.3	N/A	N/A
Share price at date of grant (pence)	380.0	380.0	380.0

The following table lists the inputs to the models used in respect of the award granted during the 52 weeks ended 27 September 2009.

	Shares subject to TSR condition	Shares subject to EPS condition	Shares subject to ROIC condition
		Share price at date of grant adjusted for	Share price at date of grant adjusted for
		dividends not received	dividends not received
Valuation model used	Monte Carlo simulation	during vesting period	during vesting period
Dividend yield (%)	4.3	4.3	4.3
Expected volatility (%)	33.1	N/A	N/A
Share price at date of grant (pence)	224.0	224.0	224.0

30. Notes to the consolidated cash flow statement

Analysis of net debt

	2011 £m	Cash flows £m	Exchange Differences £m	Other movement £m	2012 £m
Cash at bank and in hand	43.0	7.7	(1.2)	–	49.5
Bank overdrafts	–	(1.9)	–	–	(1.9)
Debt due within one year	–	–	–	(0.6)	(0.6)
Debt due after more than one year	(573.2)	1.0	13.5	–	(558.7)
	(530.2)	6.8	12.3	(0.6)	(511.7)
Derivatives hedging the balance sheet debt*	78.2	–	(13.2)	–	65.0
Adjusted net debt	(452.0)	6.8	(0.9)	(0.6)	(446.7)
	2010 £m	Cash flows £m	Exchange Differences £m	Other movement £m	2011 £m
Cash at bank and in hand	54.0	(10.4)	(0.6)	–	43.0
Debt due after more than one year	(569.9)	13.4	(12.6)	(4.1)	(573.2)
Derivatives hedging the balance sheet debt*	64.7	–	13.5	–	78.2
Adjusted net debt	(451.2)	3.0	0.3	(4.1)	(452.0)
Cash at bank and in hand	2009 £m 39.7	Cash flows £m 14.8	Exchange Differences £m (0.5)	Other movement £m –	2010 £m 54.0
Debt due after more than one year	(450.7)	(53.6)	(17.1)	(48.5)*** (569.9)
Derivatives hedging the balance sheet debt* Adjusted net debt	44.6 (366.4)	– (38.8)	20.1 2.5	– (48.5)	64.7 (451.2)
	2008	Cash flows	Exchange Differences	Other movement	2009
	£m	£m	£m	£m	£m
Cash at bank and in hand	13.9	25.6	0.2	–	39.7
Bank Overdraft	(1.0)	1.0	–	–	–
Net cash	12.9	26.6	0.2	–	39.7
Debt due within one year	(11.6)	11.6	–	–	–
Debt due after more than one year	(402.7)	(0.2)	(45.4)	(2.4)	(450.7)
Debt	(414.3)	11.4**	(45.4)	(2.4)	(450.7)
Derivatives hedging the balance sheet debt*	13.0	–	31.6	–	44.6
Adjusted net debt	(388.4)	38.0	(13.6)	(2.4)	(366.4)

* Represents the element of the fair value of interest rate currency swaps hedging the balance sheet value of the Notes. This amount has been disclosed separately to demonstrate the impact of foreign exchange movements which are included in debt due after more than one year.

** This includes issue costs paid on new loans / facilities received during the period of £nil (2011: £3.9m, 2010: £1.2m, 2009: £4.1m). This has been included in the 'Finance costs' in the Consolidated Statement of Cash Flows.

*** This includes debt assumed on the acquisition of Britvic France of £46.0m.

31. Commitments and contingencies

Operating lease commitments

Future minimum lease payments under non-cancellable operating leases are as follows:

	2012
	Land and buildings £m	Other Total £m £m
Within one year	3.1	10.3 13.4
After one year but not more than five years	13.4	17.0 30.4
More than five years	44.0	0.2 44.2
	60.5	27.5 88.0

	2011
	Land and buildings £m	Other £m	Total £m
Within one year	4.1	9.2	13.3
After one year but not more than five years	13.5	15.4	28.9
More than five years	42.0	1.1	43.1
	59.6	25.7	85.3

	2010
	Land and buildings* £m	Other £m	Total £m
Within one year	4.4	8.9	13.3
After one year but not more than five years	14.8	18.5	33.3
More than five years	45.3	2.2	47.5
	64.5	29.6	94.1

	Land and buildings* £m	Other £m	Total £m
Within one year	2.3	8.5	10.8
After one year but not more than five years	6.0	17.0	23.0
More than five years	33.0	2.9	35.9
	41.3	28.4	69.7

2009

* Restated to include two properties within Britvic Ireland that were not previously included in the prior year disclosure.

Finance lease commitments

Future minimum lease payments under finance leases are as follows:

	2009 £m	2010 £m	2011 £m	2012 £m
Within one year	–	–	–	0.3
After one year but not more than five years	–	0.7	1.2	0.5
More than five years	–	0.8	–	–
	–	1.5	1.2	0.8

Due to the timing of the expiry of the finance lease commitments, there is no material difference between the total future minimum lease payments and their fair value.

Capital commitments

At 30 September 2012, the group has commitments of £3.3m (2011: £16.9m, 2010: £12.6m, 2009: £3.2m) relating to the acquisition of new plant and machinery.

Contingent liabilities

The group had no material contingent liabilities at 30 September 2012 (2011: none, 2010: none, 2009: none material).

32. Related party disclosures

The consolidated financial statements include the financial statements of Britvic plc and the subsidiaries listed in the table below. Particulars of dormant and non-trading subsidiaries which do not materially affect the group results have been excluded.

Name	Principal activity	Country of incorporation	% equity interest
Directly held
Britannia Soft Drinks Limited	Holding company	England and Wales	100
Britvic Finance No 2 Limited	Financing company	Jersey	100
Indirectly held
Britvic Finance Limited	Financing company	Jersey	100
Britvic Holdings Limited	Holding company	England and Wales	100
Britvic Overseas Limited	Holding company	England and Wales	100
Britvic International Limited	Marketing and distribution of soft drinks	England and Wales	100
Britvic Soft Drinks Limited	Manufacture and sale of soft drinks	England and Wales	100
Robinsons Soft Drinks Limited	Non-trading	England and Wales	100
Orchid Drinks Limited	Non-trading	England and Wales	100
Red Devil Energy Drinks Limited	Non-trading	England and Wales	100
Britvic Irish Holdings Limited	Holding company	Republic of Ireland	100
Robinsons (Finance) Limited	Financing company	Republic of Ireland	100
Robinsons (Finance) No 2 Limited	Financing company	England and Wales	100
Britvic Ireland Limited	Manufacture and marketing of soft drinks	Republic of Ireland	100
Britvic Northern Ireland Limited	Marketing and distribution of soft drinks	Republic of Ireland	100
Aquaporte Limited	Supply of water-coolers and bottled water	Republic of Ireland	100
Britvic Worldwide Brands Limited	Marketing and distribution of soft drinks	Republic of Ireland	100
Britvic France SNC	Holding company	France	100
Fruité Entreprises SA	Holding company	France	100
Fruité SAS	Manufacture and sale of soft drinks	France	100
Bricfruit SAS	Manufacture and sale of soft drinks	France	100
Unisource SAS	Manufacture and sale of soft drinks	France	100
Teisseire SAS	Manufacture and sale of soft drinks	France	100
Teisseire Benelux SA	Marketing and distribution of soft drinks	France	100
Britvic North America LLC	Marketing and distribution of soft drinks	USA	100

Key management personnel are deemed to be the Executive and Non-Executive Directors of the company and members of the Executive Committee. The compensation payable to key management in the period is detailed below.

	2009 £m	2010 £m	2011 £m	2012 £m
Short-term employee benefits	4.6	5.1	2.8	3.0
Post-employment benefits	0.5	0.6	0.5	0.6
Share-based payment	1.6	2.0	1.1	0.4
	6.7	7.7	4.4	4.0

There were no other related party transactions requiring disclosure in these financial statements.

33. Going concern

The Directors are confident that it is appropriate for the going concern basis to be adopted in preparing the financial statements. As at 30 September 2012, the Consolidated Balance Sheet is showing a net assets position of £37.1m (2 October 2011: net assets of £22.5m, 3 October 2010: net liabilities of £30.7m, 27 September 2009: net liabilities of £2.5m).

Group reserves are low due to the capital restructuring undertaken at the time of flotation. This does not impact on Britvic plc's ability to make dividend payments.

The liquidity of the group remains strong in particular with £491m of long term Private Placement Notes with maturity dates between 2014 and 2022 and a £400m bank facility maturing March 2016.

PART IV

PRINCIPAL TERMS OF THE NEW LTIP

The principal terms of the New LTIP are summarised below. The rules of the New LTIP will be available for inspection from the date of publication of this document until Admission and on the date of the A.G. Barr General Meeting at the locations stated in paragraph 8 of Part V (Additional Information).

1. Eligibility

Employees and executive directors of the Combined Group and of other associated companies designated by the directors of the Combined Entity shall be eligible to participate in the New LTIP.

2. Grant of awards

The Remuneration Committee of the Combined Group (the "Committee") will decide which eligible employees will be granted awards ("Awards") under the New LTIP and over how many A.G. Barr Shares, subject to the limits set out below.

Awards may take the form of free A.G. Barr Shares or nil-cost/nominal cost options to acquire A.G. Barr Shares.

Awards will normally only be granted within 42 days of the announcement of the Company's results for any period or the effective date of any new remuneration policy (although Awards may also be granted on any day on which the Combined Group Board resolves that exceptional circumstances exist which justify the grant of Awards).

Awards will be subject to a performance condition set by the Committee at the time of grant, which will be tested over such period as the Committee may determine and will be stretching and designed to promote the long-term success of the Combined Entity. Performance conditions in respect of ordinary course Awards will be tested over at least three financial years. Awards will be granted under the New LTIP following the Merger becoming Effective, subject to applicable dealing restrictions, as follows:

• selected employees of the Combined Group will receive two awards of shares in the Combined Entity, an ordinary course award and a transitional award. For the Chief Executive Officer and Chief Financial Officer of the Combined Group, each award will be over shares with a face value of 150 per cent. of his basic salary. For other participants, award levels will be determined, by reference to band, in due course by the Committee;
• vesting of both ordinary course and transitional awards will be subject to performance conditions (based on a combination of a total shareholder return ("TSR") target (33.33 per cent.) and an earnings per share ("EPS") target (66.67 per cent.)) and continued employment; and
• the ordinary course award will vest three years after the date of grant and the transitional award will vest as to 66.67 per cent. two years after the date of grant and as to 33.33 per cent. one year after the date of grant.

The detail of the performance conditions for the first grant of Awards will be determined by the Committee shortly before such Awards are granted.

3. Individual limits

In any financial year, the aggregate market value (at the time of the grant) of the A.G. Barr Shares subject to ordinary course Awards granted to any one person under the New LTIP will not exceed 150 per cent. of his or her annual basic salary except in exceptional circumstances. In addition, and as described above, following the Merger becoming Effective, transitional awards with a maximum aggregate market value of 150 per cent. of a participant's annual basic salary will be granted.

4. Plan limits

In any 10 year period, not more than 10 per cent. of the issued ordinary share capital of the Combined Entity may be issued or be issuable under the New LTIP and all other employees' share plans operated by the Combined Entity. In addition, in any 10 year period, not more than 5 per cent. of the issued ordinary share capital of the Combined Entity may be issued or be issuable under awards under all discretionary share plans adopted by the Combined Entity. These limits do not include awards which have lapsed.

Treasury shares transferred to satisfy an Award will be counted as if new shares had been issued for so long as it is considered best practice to do so.

5. Clawback

The Committee can reduce unvested or unexercised Awards and/or delay their vesting if there has been a material misstatement of the Combined Entity's financial results or if the participant has been guilty of misconduct.

6. Vesting of Awards

When the Company grants an Award it shall determine the vesting date (which shall, apart from in relation to transitional awards, be not less than three years from the date of the grant of the Award). An Award will normally vest shortly after the end of the period over which the performance condition is tested and only to the extent that it is satisfied. For free share Awards, shares will be issued or transferred to the participant shortly after vesting, unless the Combined Entity decides to satisfy the Award in cash.

If the Award takes the form of an option, the participant can exercise the option for a period set at the date/time of grant, which will not be more than 10 years from the date of grant or seven years from the date of vesting.

7. Leaving employment

An Award will normally lapse if the participant leaves employment before vesting.

However, if the participant leaves because of disability, ill-health, injury, redundancy, retirement, sale of his employer or any other reason determined by the Committee, his Award will continue in effect and vest, to the extent the performance condition is satisfied, on the normal date. The number of shares in respect of which an Award vests will be reduced on a time pro-rated basis. The Committee can decide that an Award will vest on leaving in these circumstances instead of continuing in effect. Where this happens, the number of shares which vest will be determined taking into account the extent to which the performance condition has been satisfied to that point and the fact that the participant left before the vesting date.

If a participant dies before his Award vests, the Committee shall consider (having regard to the performance condition attaching to the Award) whether some or all of the shares subject to an Award shall vest in his personal representative.

Options are exercisable for six months from leaving employment.

8. Takeovers and reorganisations

Awards will generally vest early on a takeover, merger or other corporate reorganisation. The Committee will determine the level of vesting taking account of the extent to which the performance condition is then satisfied and the portion of the period over which the performance condition is tested which has elapsed to the date of the relevant event. Alternatively, participants may be allowed or required to exchange their Awards for awards over shares in the acquiring company.

9. Rights issues, demergers etc

The number of shares subject to an Award (and the exercise price of an option, if any) may be adjusted by the Committee to reflect a rights issue, demerger or any variation in the share capital of the Combined Entity.

10. General

Awards are not transferable (except to personal representatives on death) and are not pensionable and participants do not pay for the grant of an Award.

Any shares issued following the vesting or exercise of Awards will rank equally with shares of the same class in issue on the date of allotment except in respect of rights arising by reference to a prior record date.

11. Amendments

The Committee may, in its discretion, amend, vary or add to the rules of the New LTIP in any way. However, shareholders in general meeting must approve proposed changes which are to the advantage of participants and which relate to eligibility, individual and plan limits, the rights attaching to Awards and shares and the amendment powers.

The Committee can, without shareholder approval, make minor changes to benefit the administration of the plan, to comply with or take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment.

The Committee may also amend, vary or add to the provisions of the rules of the New LTIP as it considers necessary to take account of overseas taxation, securities or exchange control laws.

The Committee has discretion to terminate the New LTIP at any time, without prejudice to subsisting Awards.

PART V

ADDITIONAL INFORMATION

1. Responsibility

A.G. Barr and the A.G. Barr Directors, whose names appear in Part I (Letter from the Chairman of A.G. BARR p.l.c.), accept responsibility for the information contained in this document. To the best of the knowledge and belief of A.G. Barr and the A.G. Barr Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information.

2. Relevant documentation

The following sections of the Prospectus are incorporated by reference into this document:

Information	Sections of the Prospectus incorporated by reference into this document	Page number(s)
Information on A.G. Barr
Details of the Directors' interests in A.G. Barr Shares	Part XII (Additional Information), Paragraph 7 (Interests in the issued share capital of the Company of the Directors, Proposed Directors and Senior Managers) and Paragraph 8 (Directors' options and awards)	165 - 168
Service contracts of the Directors	Part XII (Additional Information), Paragraph 9 (Directors' and Proposed Directors' service contracts, terms of appointment and other details)	168 - 170
Major interests in A.G. Barr Shares	Part XII (Additional Information), Paragraph 13 (Interests of significant shareholders)	180 - 181
Related party transactions of A.G. Barr	Part XII (Additional Information), Paragraph 21 (Related party transactions)	189
Details of A.G. Barr's material contracts	Part XII (Additional Information), Paragraph 15.1 (Material contracts – material contracts of the A.G. Barr Group)	181 - 183
Details of A.G. Barr's material litigation	Part XII (Additional Information), Paragraph 16.1 (Litigation – Litigation affecting the A.G. Barr Group)	186
A.G. Barr historical financial information	Part V (Accountant's Report on the Historical Financial Information of A.G. Barr) and Part VI (Interim Unaudited Financial Statement of A.G. Barr for the six month period ended 28 July 2012)	71 - 119
Information on Britvic and the Proposed Directors
Details of the service contracts and terms of appointment of the Proposed Directors	Part XII (Additional Information), Paragraph 9 (Directors' and Proposed Directors' service contracts, terms of appointments and other details)	168 - 170
Details of Britvic's material contracts	Part XII (Additional Information), Paragraph 15.2 (Material contracts – material contracts of the Britvic Group)	183 - 186

Information	Sections of the Prospectus incorporated by reference into this document	Page number(s)
Details of Britvic's material litigation	Part XII (Additional Information), Paragraph 16.2 (Litigation – Litigation affecting the Britvic Group)	186
Information on the Combined Group
Unaudited pro forma financial information on the Combined Group	Part X (Unaudited Pro Forma Financial Information of the Combined Group)	144 -147

3. Working capital

A.G. Barr is of the opinion that, after taking into account existing available facilities and existing cash resources, the working capital available to the Combined Group is sufficient for its present requirements, that is for at least the next 12 months from the date of this document.

4. The New A.G. Barr Shares

The New A.G. Barr Shares to be issued pursuant to the Merger will be ordinary shares of 4 1/6 pence each in the capital of A.G. Barr. The New A.G. Barr Shares will be issued in registered form and will be capable of being held in both certificated and uncertificated form. The New A.G. Barr Shares will be issued credited as fully paid and will rank pari passu in all respects with the A.G. Barr Shares in issue at the time the New A.G. Barr Shares are delivered pursuant to the Merger, including the right to receive and retain dividends and other distributions (if any) paid by reference to a record date falling after the Effective Date.

Fractions of New A.G. Barr Shares allotted and issued pursuant to the Merger will not be allotted and issued to those Britvic Shareholders participating in the Scheme but will be aggregated and sold in the market as soon as practicable after the Effective Date, and the net proceeds of sale paid to such holders in due proportions.

Applications will be made to the UK Listing Authority for the New A.G. Barr Shares proposed to be issued in connection with the Merger to be admitted to the premium listing segment of the Official List and to the London Stock Exchange for the New A.G. Barr Shares to be admitted to trading on the London Stock Exchange's main market for listed securities. It is expected that the New A.G. Barr Shares will be issued, and that Admission will become effective, on 30 January 2013.

5. Profiles of key individuals at Britvic

Details of the key individuals who are important to Britvic's business as at the date of this document are set out below:

Name	Age	Current position
Paul Moody	55	Chief Executive
John Gibney	52	Group Finance Director
Alan Beaney	50	Strategy and Business Performance Director
Doug Frost	48	Human Resources Director
Simon Litherland	48	Managing Director, GB
Martin Rose	49	Supply Chain Director
Simon Stewart	48	Group Marketing Director

Paul Moody, aged 55 (Chief Executive)

Paul Moody became Chief Executive of Britvic upon the company's flotation in December 2005 and is responsible for the day-to-day running of the business. Prior to that he had held a number of senior roles including Managing Director and Chief Operating Officer. He joined Britvic in 1996 as Director of Sales for grocery multiples (supermarkets) having previously worked for Golden Wonder and Pedigree Pet Foods. Paul is also currently a Non-Executive Director of Johnson Service Group PLC, Chairman of business4Life, and Immediate Past President and a Director of The British Soft Drinks Association Limited.

John Gibney, aged 52 (Group Finance Director)

John Gibney was appointed Finance Director of Britvic in 1999 and is responsible for finance, legal, estates, risk management and business transformation. Prior to joining Britvic, he was Senior Corporate Finance & Planning Manager for Bass PLC, and prior to that role, Finance Director and subsequently Deputy Managing Director of Gala Clubs.

Alan Beaney, aged 50 (Strategy and Business Performance Director)

Alan Beaney joined Britvic as Director of Business Development in 1996 and has since held various positions within both Britvic and the Intercontinental Hotels Group ("IHG") (of which Britvic ceased to be a part upon its flotation in 2005), including Managing Director and then Chairman of Britvic International and Senior Vice President Global Strategy and Marketing for IHG. He is currently responsible for Group strategy and performance management.

Doug Frost, aged 48 (Human Resources Director)

Doug Frost was appointed Human Resources Director of Britvic in November 2004. Doug Frost is responsible for the Britvic Group's human resources including talent management, organisational capability, compensation and benefits. Doug previously worked for Alliance Unichem, and for 15 years with Mars, with positions in manufacturing, sales and human resources.

Simon Litherland, aged 48 (Managing Director, GB)

Simon Litherland was appointed to the newly-created role of Managing Director, GB of Britvic in September 2011. Bringing with him valuable experience to the position, Simon performed a similar role at Diageo where he was the Managing Director of the GB business. During his time at Diageo, Simon was responsible for an extensive portfolio of brands including Guinness, Smirnoff, Johnnie Walker and Baileys. Prior to this, Simon was the Managing Director in South Africa which led to his appointment as Managing Director of Brandhouse, a joint venture involving Diageo, Heineken and Namibia Breweries.

Martin Rose, aged 49 (Supply Chain Director)

Martin Rose was appointed as Supply Chain Director of Britvic in 2003. Martin Rose is responsible for the end-to-end supply chain, including logistics, technical development, purchasing and production. Having joined Canada Dry Rawlings in 1984 as a graduate sales trainee, Martin has a broad breadth of experience across the Britvic Group in a number of aspects including sales, operations, distribution and logistics.

Simon Stewart, aged 48 (Group Marketing Director)

Simon Stewart joined Britvic from EMAP, where he was Chief Marketing Officer. Simon began his marketing career with the Coca-Cola Company in Australia, and over eight years operated across brand management and strategic development, based in Sydney and Atlanta before finally moving on to Marketing Services for the South Pacific region. He then moved to Diageo where he ultimately became Vice President Marketing for the Smirnoff brand. Simon joined Britvic in 2008 as Group Marketing Director.

6. No significant change

A.G. Barr

There has been no significant change in the financial or trading position of the A.G. Barr Group since 28 July 2012, being the date of the last financial information of the A.G. Barr Group incorporated into this document by reference as described in paragraph 2 of this Part V.

Britvic

There has been no significant change in the financial or trading position of the Britvic Group since 30 September 2012, being the date of the last financial information of the Britvic Group contained in this document in Part III (Historical Financial Information Relating to Britvic).

7. Consent

Rothschild, whose address is New Court, St Swithin's Lane, London EC4N 8AL, has given and has not withdrawn its written consent to the inclusion in this document of references to its name in the form and context in which it appears.

8. Documents available for inspection

Copies of the following documents will be available for inspection during usual business hours on any weekday (Saturdays, Sundays and public holidays excepted), from the date of publication of this document until Admission, at the offices of Dickson Minto W.S., Broadgate Tower, 20 Primrose Street, London EC2A 2EW and at the registered office of A.G. Barr, Westfield House, 4 Mollins Road, Cumbernauld G68 9HD (telephone number +44 (0) 1236 852 400) and, on the date of the A.G. Barr General Meeting, at the place of the A.G. Barr General Meeting from 9.45 a.m. until the conclusion of the A.G. Barr General Meeting:

• (a) the documents referred to in paragraph 30 of Part XII (Additional Information) of the Prospectus;
• (b) the consent letter referred to in paragraph 7 above;
• (c) the proposed amended rules of the A.G. Barr Long Term Incentive Plan;
• (d) the proposed rules of the New LTIP; and
• (e) the proposed New A.G. Barr Articles.

DEFINITIONS

The following definitions apply throughout this document unless the context otherwise requires:

£, GBP, Sterling, pence or p	the lawful currency of the UK
Admission	the New A.G. Barr Shares being admitted to the premium listing segment of the Official List and to trading on the London Stock Exchange's main market for listed securities
A.G. Barr or Company	A.G. BARR p.l.c.
A.G. Barr All-Employee Share Ownership Plan	the Company's All-Employee Share Ownership Plan approved at its annual general meeting held on 21 May 2001 and re-approved at its annual general meeting held on 21 May 2012
A.G. Barr Articles	the articles of association of A.G. Barr
A.G. Barr Board	the board of directors of A.G. Barr
A.G. Barr Executive Share Option Scheme	the Company's Executive Share Option Scheme 2010 adopted on 24 May 2010
A.G. Barr General Meeting	the general meeting of A.G. Barr to be held at 10.00 a.m. London time on Tuesday, 8 January 2013 at the offices of KPMG LLP, 191 West George Street, Glasgow G2 2LJ (and any adjournment thereof) for the purposes of considering and, if thought fit, approving the Resolutions
A.G. Barr Group	A.G. Barr, its subsidiaries and subsidiary undertakings from time to time (excluding, for the avoidance of doubt, the Britvic Group)
A.G. Barr Long Term Incentive Plan	the Company's Long Term Incentive Plan 2003 adopted on 19 May 2003 and as subsequently amended
A.G. Barr Savings Related Share Option Scheme	the Company's 2005 Share Savings Scheme adopted on 24 May 2005 and as subsequently amended
A.G. Barr Shareholders	holders of A.G. Barr Shares
A.G. Barr Share Schemes	the A.G. Barr Executive Share Option Scheme, the A.G. Barr Savings Related Share Option Scheme, the A.G. Barr All-Employee Share Ownership Plan and the A.G. Barr Long Term Incentive Plan, each as amended from time to time
A.G. Barr Shares	fully paid-up ordinary shares of 4 1/6 pence each in the capital of A.G. Barr
A.G. Barr's Registrars or Registrars	Equiniti Limited
AGM	annual general meeting
Britvic	Britvic plc
Britvic Court Meeting	the meeting of the Britvic Shareholders to be convened by order of the Court pursuant to section 896 of the Companies Act for the purpose of approving the Scheme, including any adjournment thereof
Britvic Directors	the directors of Britvic
Britvic Executive Share Option Plan	the rules of Britvic's Executive Share Option Plan adopted on 9 December 2005
Britvic General Meeting	the general meeting of Britvic to be convened in connection with the Scheme and the Reduction of Capital, including any adjournment thereof

Britvic Group	Britvic, its subsidiaries and subsidiary undertakings from time to time
Britvic Performance Share Plan	the rules of Britvic's Performance Share Plan adopted on 9 December 2005
Britvic Share Incentive Plan	the trust deed and rules of Britvic's Share Incentive Plan adopted on 25 April 2003
Britvic Shareholders	holders of Britvic Shares
Britvic Shares	fully paid-up ordinary shares of 20 pence each in the capital of Britvic
Britvic Share Schemes	the Britvic Executive Share Option Plan, the Britvic Performance Share Plan and the Britvic Share Incentive Plan, each as amended from time to time
Business Day	a day on which the London Stock Exchange is open for business
Code or City Code	the City Code on Takeovers and Mergers published by the Panel
Combined Entity	the ultimate parent company of the Combined Group, which upon the Merger becoming Effective will be A.G. Barr (proposed to be renamed as "Barr Britvic Soft Drinks plc")
Combined Entity Ordinary Share Capital	all of the issued A.G. Barr Shares at the date immediately following the Merger becoming Effective
Combined Group	the combined group following the Merger, comprising the A.G. Barr Group and the Britvic Group
Combined Group Board	the board of directors of the Combined Entity following the Merger
Companies Act	the Companies Act 2006, as amended from time to time
Competition Commission	the independent public body which conducts second phase in-depth inquiries into mergers, markets and the regulation of the major regulated industries in the United Kingdom (or any successor body or bodies carrying out the same functions in the United Kingdom from time to time)
Conditions	the conditions to the implementation of the Merger (including the Scheme) as set out in Part IV of the Scheme Document
Court	the High Court of Justice in England and Wales
Court Hearing	the hearing by the Court to sanction the Scheme and to confirm the Reduction of Capital
Court Order	the order of the Court sanctioning the Scheme and confirming the Reduction of Capital
CREST	the relevant system (as defined in the CREST Regulations) for paperless settlement of share transfers and the holding of shares in uncertificated form in respect of which Euroclear UK & Ireland Limited is the operator (as defined in the CREST Regulations)
CREST Manual	the rules governing the operation of CREST, consisting of the CREST Reference Manual, CREST International Manual, CREST Central Counterparty Service Manual, CREST Rules, Registrars Service Standards, Settlement Discipline Rules, CCSS Operations Manual, Daily Timetable, CREST Application Procedure and CREST Glossary of Terms (all as defined in the CREST Glossary of Terms)

CREST Regulations	the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755), as amended
Daily Official List	the daily official list of the London Stock Exchange
Directors or A.G. Barr Directors	the directors of A.G. Barr, whose names appear in Part I (Letter from the Chairman of A.G. BARR p.l.c.)
Effective	in the context of the Merger:
	(a) if the Merger is implemented by way of the Scheme, the Scheme having become effective pursuant to its terms; or
	(b) if the Merger is implemented by way of a Merger Offer, such Merger Offer having been declared and become unconditional in all respects in accordance with the requirements of the Code
Effective Date	the date upon which the Merger becomes Effective
Exclusive Bottling Appointments	the following appointments relating to certain Pepsi and 7UP brands:
	(a) the two exclusive bottling appointments relating to Great Britain, the Isle of Man and Gibraltar entered into on 10 March 2004 by certain members of the Britvic Group and PepsiCo, Inc. in relation to certain Pepsi brands and entered into on 10 March 2004 by certain members of the Britvic Group and Seven-Up International in relation to certain 7UP brands;
	(b) the two exclusive bottling appointments relating to the Republic of Ireland entered into on 7 October 1999 by certain members of the Britvic Group and PepsiCo, Inc. in relation to certain Pepsi brands and entered into on 1 January 2001 by certain members of the Britvic Group and Seven-Up International in relation to certain 7UP brands; and
	(c) the two exclusive bottling appointments relating to Northern Ireland entered into on 7 October 1999 by certain members of the Britvic Group and PepsiCo, Inc. in relation to certain Pepsi brands and entered into on 1 January 2001 by certain members of the Britvic Group and Seven-Up International in relation to certain 7UP brands
Form of Direction	the form of direction for use by participants in the A.G. Barr All-Employee Share Ownership Plan in connection with the A.G. Barr General Meeting
Form of Proxy	the form of proxy for use by A.G. Barr Shareholders in connection with the A.G. Barr General Meeting
FSA	the Financial Services Authority
FSMA	the Financial Services and Markets Act 2000, as amended from time to time
GB	Great Britain
HSBC Facility	the facility made available to A.G. Barr pursuant to the HSBC Facility Agreement
HSBC Facility Agreement	the revolving credit facility agreement entered into between A.G. Barr and HSBC Bank plc on 26 July 2012
IFRS	International Financial Reporting Standards, as adopted by the European Union
Ireland	the Republic of Ireland and Northern Ireland

Listing Rules	the rules and regulations made by the UK Listing Authority under Part VI of FSMA, and contained in the UK Listing Authority's publication of the same name (as amended from time to time)
London Stock Exchange	London Stock Exchange plc
Long Stop Date	30 June 2013 (or such later date as A.G. Barr and Britvic may agree)
Merger	the acquisition of the entire issued and to be issued share capital of Britvic by A.G. Barr to be implemented by way of the Scheme or (should A.G. Barr so elect, subject to the consent of the Panel and Britvic's prior written consent) by way of a Merger Offer
Merger Offer	the implementation of the Merger by means of a takeover offer under section 974 of the Companies Act, rather than by means of the Scheme
Merger Resolution	resolution 1 set out in the notice convening the A.G. Barr General Meeting at the end of this document
New A.G. Barr Articles	the new articles of association of A.G. Barr proposed to be adopted at the A.G. Barr General Meeting, conditional upon the Merger becoming Effective, pursuant to resolution 5 set out in the notice of that meeting
New A.G. Barr Shares	the new A.G. Barr Shares to be issued and credited as fully paid to Britvic Shareholders pursuant to the Merger
New LTIP	the new long term incentive plan (to be called the Barr Britvic Soft Drinks plc Long Term Incentive Plan) proposed to be established by the Company, conditional upon the Merger becoming Effective, pursuant to resolution 4 set out in the notice of the A.G. Barr General Meeting
Official List	the official list of the UK Listing Authority
OFT	the Office of Fair Trading of the United Kingdom (or any successor authority or authorities carrying out consumer credit regulatory and/or competition law and merger control enforcement functions in the United Kingdom from time to time)
Panel	the Panel on Takeovers and Mergers
Pepsi Group	PepsiCo, Inc., a corporation organised under the laws of the State of North Carolina, with a registered business address of 700 Anderson Hill Road, Purchase, New York, or any wholly-owned (direct or indirect) subsidiary of such corporation
Preliminary Results	the preliminary unaudited consolidated financial results for Britvic for the 52 weeks ended 30 September 2012 published on 27 November 2012 and set out in Part III of this document
Proposed Directors	Gerald Corbett, John Gibney, Joanne Averiss, Bob Ivell, Ben Gordon and John Nicolson
Prospectus	the prospectus relating to A.G. Barr and the Admission of the New A.G. Barr Shares
Prospectus Rules	the rules for the purposes of Part VI of FSMA in relation to the offer of securities to the public and the admission of securities to trading on a regulated market
RBS	The Royal Bank of Scotland plc, a company incorporated in Scotland with registered number SC90312

RBS Facility	the facility made available to A.G. Barr pursuant to the RBS Facility Agreement
RBS Facility Agreement	the term loan and revolving credit facility agreement entered into between A.G. Barr and RBS on 4 August 2008, as amended and restated on 25 March 2011
Reduction of Capital	the proposed reduction of Britvic's share capital under Chapter 10 of Part 17 of the Companies Act, pursuant to the Scheme
Registrar of Companies	the Registrar of Companies in England and Wales
Regulatory Information Service	any of the services authorised from time to time by the FSA for the purposes of disseminating regulatory announcements
Remuneration Committee	the remuneration committee of the A.G. Barr Board from time to time
Resolutions	the resolutions to be proposed at the A.G. Barr General Meeting (as set out in the notice of general meeting contained at the end of this document)
Rothschild	N.M. Rothschild & Sons Limited of New Court, St Swithin's Lane, London EC4N 8AL
Scheme	the scheme of arrangement proposed to be made under Part 26 of the Companies Act between Britvic and the Britvic Shareholders in connection with the Merger, with or subject to any modification, addition or condition approved or imposed by the Court and agreed to by A.G. Barr and Britvic
Scheme Document	the document to be sent to (among others) Britvic Shareholders containing and setting out, among other things, the full terms and conditions of the Scheme and containing the notices convening the Britvic Court Meeting and the Britvic General Meeting
Scheme Record Time	6.00 p.m. on the Business Day immediately prior to the date of the Court Hearing
Scheme Voting Record Time	6.00 p.m. on the day which is two days before the date of the Britvic Court Meeting or, if the Britvic Court Meeting is adjourned, 6.00 p.m. on the day which is two days before the date set for the adjourned Britvic Court Meeting
Special Resolution	the special resolution to be proposed by Britvic at the Britvic General Meeting in connection with, among other things, the approval of the Scheme and confirmation of the Reduction of Capital, the alteration of Britvic's articles of association and such other matters as may be necessary to implement the Scheme and the delisting of the Britvic Shares
Statement of Capital	the statement of capital (approved by the Court) showing, with respect to Britvic's share capital as altered by the Court Order, the information required by section 649 of the Companies Act
UK Listing Authority or UKLA	the FSA acting in its capacity as the competent authority for listing under FSMA
United Kingdom or UK	the United Kingdom of Great Britain and Northern Ireland
United States of America, United States, USA or US	the United States of America, its territories and possessions, any state of the United States and the District of Columbia

NOTICE OF GENERAL MEETING

A.G. BARR P.L.C.

(incorporated and registered in Scotland with registered number SC005653)

NOTICE IS HEREBY GIVEN that a general meeting (the "Meeting") of A.G. BARR p.l.c. (the "Company" or "A.G. Barr") will be held at the offices of KPMG LLP, 191 West George Street, Glasgow G2 2LJ at 10.00 a.m. London time on Tuesday, 8 January 2013 for the purposes of considering and, if thought fit, passing the resolutions set out below. Resolutions 1, 3, 4 and 6 will be proposed as ordinary resolutions. Resolutions 2, 5, 7 and 8 will be proposed as special resolutions.

Please note that the implementation of the proposed all-share merger of A.G. Barr with Britvic plc (the "Merger") is conditional upon the passing of the first resolution set out in this notice only.

Resolution 1 (Ordinary Resolution)

THAT:

• (A) the proposed all-share merger of A.G. BARR p.l.c. (the "Company" or "A.G. Barr") with Britvic plc ("Britvic") (the "Merger"), to be effected pursuant to a scheme of arrangement of Britvic (the "Scheme") under Part 26 of the Companies Act 2006 (the "Act") or a takeover offer (the "Merger Offer") made by or on behalf of the Company for the entire issued and to be issued share capital of Britvic, substantially on the terms and subject to the conditions set out in the circular to shareholders of A.G. Barr dated 5 December 2012 (the "Circular") outlining the Merger and the prospectus prepared by the Company in connection with Admission (as defined below) dated 5 December 2012 (a copy of each of which is produced to the meeting and signed for identification purposes by the chairman of the meeting) be and is hereby approved and the directors of the Company (the "Directors") (or any duly authorised committee thereof) be and are hereby authorised to: (i) take all such steps as may be necessary or desirable in connection with, and to implement, the Merger; and (ii) agree such modifications, variations, revisions, waivers or amendments to the terms and conditions of the Merger (provided that any such modifications, variations, revisions, waivers or amendments are not a material change to the terms of the Merger for the purposes of Listing Rule 10.5.2) and to any documents and arrangements relating thereto, as they may in their absolute discretion think fit;
• (B) subject to and conditional upon the Scheme becoming effective (save for any conditions relating to: (i) the delivery of the order(s) of the High Court of Justice in England and Wales (the "Court") sanctioning the Scheme and confirming the reduction of capital of Britvic to the Registrar of Companies in England and Wales; (ii) registration of such order(s) by the Registrar of Companies in England and Wales; and (iii) (a) the UK Listing Authority having acknowledged to the Company or its agent (and such acknowledgment not having been withdrawn) that the application for the admission of the new ordinary shares of 41⁄6 pence each in the capital of the Company to be issued pursuant to the Merger (the "Ordinary Shares") to the Official List of the UK Listing Authority with a premium listing has been approved and (after satisfaction of any conditions to which such approval is expressed to be subject (the "listing conditions")) will become effective as soon as a dealing notice has been issued by the Financial Services Authority and any listing conditions have been satisfied; and (b) the London Stock Exchange plc having acknowledged to the Company or its agent (and such acknowledgment not having been withdrawn) that the Ordinary Shares will be admitted to trading on the main market of the London Stock Exchange plc ("Admission")), or, as the case may be, the Merger Offer becoming or being declared wholly unconditional (save for Admission), the Directors be and are hereby generally and unconditionally authorised pursuant to section 551 of the Companies Act 2006 (the "Act") (in addition, to the extent unutilised, to the authority granted to the Directors at the Company's annual general meeting held on 21 May 2012, which remains in full force and effect) to exercise all the powers of the Company to allot Ordinary Shares and to grant rights to subscribe for or to convert any security into shares in the Company, credited as fully paid, with authority to deal with fractional entitlements arising out of such allotment as they think fit and to take all such other steps as they may in their absolute discretion deem necessary, expedient or appropriate to implement such allotment, in connection with the Merger up to an aggregate nominal amount of £8,416,666.67 and which authority shall expire at the conclusion of the annual general meeting of the Company to be held in 2013 or on the Long Stop Date (as defined in the Circular), whichever is the later (unless previously revoked, renewed or varied by the Company in general meeting), save that the Company may before such expiry make an offer or enter into an agreement which would or might require shares to be allotted, or rights to subscribe for or to convert securities into shares to be granted, after such expiry and the Directors may allot shares or grant such rights in pursuance of such an offer or agreement as if the authority conferred hereby had not expired; and

(C) pursuant to article 103 of the Company's articles of association, the Company be permitted to borrow up to an aggregate amount of £1,250,000,000.

Resolution 2 (Special Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to the shareholders of the Company dated 5 December 2012), the Company's name be changed to "Barr Britvic Soft Drinks plc".

Resolution 3 (Ordinary Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to the shareholders of the Company dated 5 December 2012 (the "Circular")), the amendments to the rules of the A.G. BARR p.l.c. Long Term Incentive Plan 2003 (as amended on 26 May 2009) (the "Long Term Incentive Plan") shown on the copy produced to the meeting and, for the purposes of identification, initialled by the chairman of the meeting (the "Amended LTIP Rules") be approved and the Directors of the Company (or a duly authorised committee of the Directors) be and are hereby authorised to make such other amendments to the rules of the Long Term Incentive Plan and to do all such acts and things as they consider necessary or desirable to give effect to the proposed treatment of the participants in that plan as described in paragraph 13 of Part I of the Circular.

Resolution 4 (Ordinary Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to the shareholders of the Company dated 5 December 2012 (the "Circular")):

• (i) the rules of the Barr Britvic Soft Drinks plc Long Term Incentive Plan (the "Plan"), a copy of which has been produced to the meeting and is initialled for the purposes of identification by the chairman of the meeting and the principal terms of which are summarised in Part IV of the Circular, be approved, adopted and established and the Directors of the Company (or a duly authorised committee of the Directors) be and they are hereby authorised to do all such acts and things which they consider necessary or desirable to establish and carry the Plan into effect with such modifications as they may consider necessary or desirable to take account of the requirements of the UK Listing Authority and best practice;
• (ii) the Directors be authorised to establish one or more other schemes or plans based on the Plan for the benefit of employees based overseas but modified to take account of local tax, exchange control or securities laws in overseas territories provided that any shares made available under such further schemes or plans are treated as counting against any limits on individual or overall participation in the Plan; and
• (iii) the Directors be entitled to vote and be counted in the quorum on any matter connected with the Plan notwithstanding that they may be interested in the same and any prohibition on voting by interested Directors contained in the articles of association of the Company from time to time (save that no Director may vote or be counted in the quorum on any matter solely concerning his own participation in the Plan).

Resolution 5 (Special Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to the shareholders of the Company dated 5 December 2012), the articles of association produced to the meeting and, for the purposes of identification, initialled by the chairman of the meeting be adopted as the articles of association of the Company in substitution for, and to the entire exclusion of, the articles of association of the Company existing at the date of the meeting.

Resolution 6 (Ordinary Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to the shareholders of the Company dated 5 December 2012), in addition to the amount set out in paragraph (B) of such resolution 1 but in substitution for any previous authority conferred upon the directors of the Company (the "Directors") pursuant to section 551 of the Companies Act 2006 (the "Act"), the Directors be and are hereby generally and unconditionally authorised pursuant to section 551 of the Act to exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe for or to convert any security into shares in the Company:

(i) up to an aggregate nominal amount of £4,383,070.70; and

(ii) up to a further aggregate nominal amount of £4,383,070.70 provided that (i) they are equity securities (within the meaning of section 560 of the Act), and (ii) they are offered by way of a rights issue in favour of the holders of shares (excluding the Company in its capacity as a holder of treasury shares) on the register of members of the Company on a date fixed by the Directors where the equity securities respectively attributable to the interests of such holders are proportionate (as nearly as practicable) to the respective numbers of shares held by them on that date subject to such exclusions or other arrangements as the Directors deem necessary or expedient to deal with (a) equity securities representing fractional entitlements, (b) treasury shares, or (c) legal or practical problems arising in any overseas territory, the requirements of any regulatory body or any stock exchange or any other matter whatsoever,

provided that this authority shall expire at the conclusion of the annual general meeting of the Company to be held in 2013 or on 31 July 2013, whichever is the earlier (unless previously revoked, renewed or varied by the Company in general meeting), save that the Company may before such expiry make an offer or enter into an agreement which would or might require shares to be allotted, or rights to subscribe for or to convert securities into shares to be granted, after such expiry and the Directors may allot shares or grant such rights in pursuance of such an offer or agreement as if the authority conferred hereby had not expired.

Resolution 7 (Special Resolution)

THAT, subject to (i) the Merger becoming Effective (as such terms are defined in the circular to shareholders of the Company dated 5 December 2012) and (ii) the passing of resolution 6 set out in the notice of this general meeting, and in substitution for any previous authority conferred upon the directors of the Company (the "Directors") pursuant to sections 570 and 573 of the Companies Act 2006 (the "Act"), the Directors be and are hereby generally empowered pursuant to sections 570 and 573 of the Act to allot equity securities (within the meaning of section 560 of the Act) (including the grant of rights to subscribe for, or to convert any security into, ordinary shares of the Company ("Ordinary Shares")) wholly for cash either pursuant to the authority conferred on them by such resolution 6 or by way of a sale of treasury shares (within the meaning of section 560(3) of the Act) as if section 561 of the Act did not apply to any such allotment or sale, provided that this power shall be limited to:

• (i) the allotment of equity securities for cash in connection with a rights issue, open offer or other pre-emptive offer in favour of holders of Ordinary Shares (excluding the Company in its capacity as a holder of treasury shares) on the register of members of the Company on a date fixed by the Directors where the equity securities respectively attributable to the interests of such holders are proportionate (as nearly as practicable) to the respective numbers of Ordinary Shares held by them on that date subject to such exclusions or other arrangements in connection with the rights issue, open offer or other pre-emptive offer as the Directors deem necessary or expedient to deal with (a) equity securities representing fractional entitlements, (b) treasury shares, or (c) legal or practical problems arising in any overseas territory, the requirements of any regulatory body or any stock exchange or any other matter whatsoever; and
• (ii) the allotment (otherwise than pursuant to sub-paragraph (i) above) of equity securities up to an aggregate nominal amount of £664,101.62,

provided that this authority shall expire at the conclusion of the annual general meeting of the Company to be held in 2013 or on 31 July 2013, whichever is the earlier (unless previously revoked, renewed or varied by the Company in general meeting), save that the Company may before such expiry make an offer or enter into an agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity securities in pursuance of such an offer or agreement as if the authority conferred hereby had not expired.

Resolution 8 (Special Resolution)

THAT, subject to the Merger becoming Effective (as such terms are defined in the circular to shareholders of the Company dated 5 December 2012), the Company be and is hereby generally and unconditionally authorised for the purposes of section 701 of the Companies Act 2006 (the "Act") to make one or more market purchases (within the meaning of section 693(4) of the Act) of ordinary shares of 4 1/6 pence each in the capital of the Company ("Ordinary Shares") on such terms and in such manner as the directors of the Company (the "Directors") think fit, provided that:

• (i) the maximum aggregate number of Ordinary Shares hereby authorised to be purchased is 31,876,877;

• (ii) the minimum price, exclusive of any associated expenses, which may be paid for an Ordinary Share is 4 1/6 pence;

• (iii) the maximum price, exclusive of any associated expenses, which may be paid for an Ordinary Share shall be the higher of:

• (a) an amount equal to 5 per cent. above the average of the middle market quotations for an Ordinary Share as derived from the London Stock Exchange Daily Official List for the five dealing days immediately preceding the day on which the Ordinary Share is contracted to be purchased; and
• (b) the higher of the price of the last independent trade and the highest current independent bid on the London Stock Exchange Daily Official List at the time that the purchase is carried out; and
• (iv) the authority hereby conferred shall be in substitution for any previous authority conferred on the Company under section 701 of the Act and shall expire at the conclusion of the annual general meeting of the Company to be held in 2013 or on 31 July 2013, whichever is the earlier (unless previously revoked, renewed or varied by the Company in general meeting), but a contract to purchase Ordinary Shares may be made before such expiry which will or may be executed or completed wholly or partly thereafter and a purchase of Ordinary Shares may be made in pursuance of any such contract.

By order of the Board	Registered office:
Julie A. Barr	Westfield House 4 Mollins Road
Company Secretary 5 December 2012	Cumbernauld G68 9HD

Notes:

1. Attending the A.G. Barr General Meeting in person

If you wish to attend the A.G. Barr General Meeting in person, you should arrive at the venue for the meeting in good time to allow your attendance to be registered. It is advisable to have some form of identification with you as you may be asked to provide evidence of your identity to the Company's registrar, Equiniti Limited (the "Registrars"), prior to being admitted to the meeting.

2. Appointment of proxies

Members are entitled to appoint one or more proxies to exercise all or any of their rights to attend, speak and vote at the A.G. Barr General Meeting. A proxy need not be a member of the Company but must attend the A.G. Barr General Meeting to represent a member. To be validly appointed, a proxy must be appointed using the procedures set out in these notes and in the notes to the accompanying Form of Proxy.

If a member wishes a proxy to speak on their behalf at the A.G. Barr General Meeting, the member will need to appoint their own choice of proxy (not the Chairman of the meeting) and give their instructions directly to them.

A proxy may be appointed using the Form of Proxy accompanying this document or through CREST. Members can only appoint more than one proxy where each proxy is appointed to exercise rights attached to different shares. Members cannot appoint more than one proxy to exercise the rights attached to the same share(s). If a member wishes to appoint more than one proxy, they should contact the Registrars at Equiniti Limited, Aspect House, Spencer Road, Lancing BN99 6DA.

A member may instruct their proxy to abstain from voting on a particular resolution to be considered at the A.G. Barr General Meeting by marking the "Withheld" option in relation to that particular resolution when appointing their proxy. It should be noted that an abstention is not a vote in law and will not be counted in the calculation of the proportion of votes "For" or "Against" the resolution.

The appointment of a proxy will not prevent a member from attending the A.G. Barr General Meeting and voting in person if he or she wishes.

A person who is not a member of the Company but who has been nominated by a member to enjoy information rights does not have a right to appoint any proxies under the procedures set out in these notes and should read note 8 below.

3. Appointment of a proxy using a Form of Proxy

A.G. Barr Shareholders will find enclosed a Form of Proxy for use in connection with the A.G. Barr General Meeting. To be valid, a Form of Proxy or other instrument appointing a proxy, together with any power of attorney or other authority under which it is signed or a certified copy thereof, must be received by post or (during normal business hours only) by hand by the Registrars at Equiniti Limited, Aspect House, Spencer Road, Lancing BN99 6DA no later than 48 hours before the time of the A.G. Barr General Meeting or any adjournment of that meeting.

If you do not have a Form of Proxy and believe that you should have one, or you require additional Forms of Proxy, please contact the Registrars at Equiniti Limited, Aspect House, Spencer Road, Lancing BN99 6DA.

4. Appointment of a proxy through CREST

CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the procedures described in the CREST Manual and by logging on to the following website: www.euroclear.com/CREST. CREST personal members or other CREST sponsored members, and those CREST members who have appointed (a) voting service provider(s), should refer to their CREST sponsor or voting service provider(s) who will be able to take the appropriate action on their behalf.

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear UK & Ireland Limited's specifications, and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the Registrars (ID RA19) no later than 48 hours before the time of the A.G. Barr General Meeting or any adjournment of that meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the Registrars are able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time, any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.

CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed (a) voting service provider(s), to procure that their CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.

The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.

5. Appointment of a proxy by joint holders

In the case of joint holders, where more than one of the joint holders purports to appoint one or more proxies, only the purported appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the Company's register of members in respect of the joint holding (the first named being the most senior).

6. Corporate representatives

Any corporation which is a member can appoint one or more corporate representatives. Members can only appoint more than one corporate representative where each corporate representative is appointed to exercise rights attached to different shares. Members cannot appoint more than one corporate representative to exercise the rights attached to the same share(s).

7. Entitlement to attend and vote

To be entitled to attend and vote at the A.G. Barr General Meeting (and for the purpose of determining the votes they may cast), members must be registered in the Company's register of members at 6.00 p.m. on 6 January 2013 (or, if the A.G. Barr General Meeting is adjourned, at 6.00 p.m. on the day two days prior to the adjourned meeting). Changes to the Company's register of members after the relevant deadline will be disregarded in determining the rights of any person to attend and vote at the A.G. Barr General Meeting.

8. Nominated persons

Any person to whom this notice is sent who is a person nominated under section 146 of the Companies Act 2006 (the "Companies Act") to enjoy information rights (a "Nominated Person") may, under an agreement between him/her and the member by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the A.G. Barr General Meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the member as to the exercise of voting rights.

9. Website giving information regarding the A.G. Barr General Meeting

Information regarding the A.G. Barr General Meeting, including information required by section 311A of the Companies Act and a copy of this notice of the A.G. Barr General Meeting, is available from www.agbarr.co.uk.

10. Voting rights

As at 3 December 2012, the Company's issued share capital consisted of 116,768,778 ordinary shares, carrying one vote each. The Company does not hold any shares in treasury. Therefore, the total voting rights in the Company as at 3 December 2012 were 116,768,778 votes.

11. Notification of shareholdings

Any person holding 3 per cent. or more of the total voting rights of the Company who appoints a person other than the Chairman of the meeting as his/her proxy will need to ensure that both he/she, and his/her proxy, comply with their respective disclosure obligations under the UK Disclosure and Transparency Rules.

12. Further questions and communication

Under section 319A of the Companies Act, the Company must cause to be answered any question relating to the business being dealt with at the A.G. Barr General Meeting put by a member attending the meeting unless answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information, or the answer has already been given on a website in the form of an answer to a question, or it is undesirable in the interests of the Company or the good order of the meeting that the question be answered.

Members who have any general queries about the A.G. Barr General Meeting should contact the Company Secretarial Department of A.G. Barr by email at companysecretarialdepartment@agbarr.co.uk.

Members may not use any electronic address provided in this document or in any related documents (including the accompanying documents) to communicate with the Company for any purpose other than those expressly stated.

Printed by RR Donnelley 421960