47153 AG Barr Annual Report 2025 AW4 SQ WEB - Flipbook - Page 56
A.G. BARR p.l.c. Annual Report and Accounts 2025
FI N A N C I A L R E VI E W CO N T I N U ED
Treasury and Commodity
Risk Management
The treasury and commodity risks faced by
the Group are identified and managed by the
Group Treasury and Commodity Committee
whose activities are carried out in accordance
with Board approved policies and subject to
continued Audit and Risk Committee oversight.
Key financial risks managed by this committee
include exposures to foreign exchange rates
and the management of the Group’s debt,
commodity and liquidity positions. The Group
uses financial instruments to hedge against
foreign currency exposures. No transactions
are entered into for speculative purposes.
The Group seeks to mitigate risks in relation to
supply continuity of key raw materials and
ingredients by developing strong commercial
relationships with our key suppliers. The Group
actively manages commodity pricing risk and
where commercially appropriate will enter into
fixed price supply contracts with suppliers to
reduce risk.
As at 25 January 2025, the Group had £42.5m of
funds held on short-term, interest earning deposit
with two relationship banks. In addition to the
Group’s cash position, the Group had £20.0m
of unutilised committed debt facilities, consisting
of a revolving credit facility with our principal
relationship bank. This expires in February 2026
and, at this point, we have no plans to renew it.
Our funding requirements and facilities are
continually reviewed to ensure they remain
appropriate, providing a balance of security
and optionality.
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Accounting Policies
The Group’s financial statements have been
prepared in accordance with International
Financial Reporting Standards and the Listing
Rules of the Financial Conduct Authority.
There have been no changes to the accounting
policies applied this year. All new or amended
standards that are applicable have been
adopted with no material impact on the results
for the current and prior reporting periods.
On an IAS 19 valuation basis, which is determined
before the benefit of the Central Asset Reserve
(CAR) funding arrangement, the surplus of £3.2m
as at 28 January 2024 improved to a surplus of
£6.8m as at the balance sheet date. The scheme
has a long-established financial de-risking
strategy that includes pensioner buy-in policies
and asset hedging. The Group continues to work
proactively with the Pension Trustee to further
de-risk the pension liabilities and secure the
commitments to employee benefits as part of
the Group’s ongoing strategic risk management.
Pensions
The Group continues to operate the A G BARR
p.l.c. (2008) Pension and Life Assurance Scheme.
This is a defined benefit scheme based on final
salary which has been closed to new entrants
since 5 April 2002 and closed to future accrual
for members in May 2016. Existing and new
employees have been invited to join an
outsourced defined contribution scheme.
The pension scheme remains well funded and in
surplus. The scheme’s triennial valuation as at
April 2023 identified a £3.2m surplus on a technical
provisions basis and indicated that the scheme
could be expected to reach self-sufficiency by
2032, with no additional cash contributions
required. During the year, Company contributions
of £3.3m were made as part of the Company’s
long term de-risking strategy.
This year’s strong financial performance
demonstrates the rigorous execution of our
growth strategy. In an environment that remains
challenging, we believe that our clear strategy,
the strength of our brands and our well invested
asset base underpin the growth potential of the
business. We remain confident in our ability to
deliver continued growth in revenue and
operating margin as well as a strong return
on capital employed in the years ahead.
Stuart Lorimer
Chief Finance and Operating Officer
25 March 2025
* Items marked with an asterisk are non-GAAP measures.
Definitions and relevant reconciliations are provided in the
Glossary on pages 192 to 195.
