PERNOD RICARD - 2018-2019 Universal registration document
6.
CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements
30.06.2019
30.06.2018
Medical expenses and other employee benefits
Medical expenses and other employee benefits
Pension benefits
Actuarial assumptions in respect of the expense for the period
Pension benefits
Discount rate
2.62%
3.50%
2.78%
3.40%
Average rate of increase in annuities
3.34% Not applicable
3.29% Not applicable
Average salary increase
2.81%
3.39%
2.60%
3.16%
Expected increase in medical expenses Initial rate
Not applicable Not applicable
6.65% Not applicable 4.75% Not applicable
6.22% 4.61%
Final rate
Other non-eurozone countries
Actuarial assumptions at 30.06.2019 (pensions and other long-term employee benefits) By region
United Kingdom United States
Eurozone countries
Canada
Discount rate
2.30%
3.42%
3.10%
1.33% 1.33% 2.38%
3.31% 1.87% 3.97%
Average rate of increase in annuities
3.44% Not applicable Not applicable
Average salary increase
2.12%
3.50%
3.00%
Expected increase in medical expenses Initial rate
5.50% 5.50%
6.66% 4.50%
5.28% 4.50%
3.50% Not applicable 3.50% Not applicable
Final rate
The obligation period-related discount rates used within the Eurozone are as follows: short-term rate (3-5 years): 0.25%; medium-term rate (5-10 years): 0.50%; long-term rate (more than 10 years): 1.00% to 1.60%.
Discount rates are determined by reference to the yield at the balance sheet date on premium category corporate bonds (if available), or on government bonds, with maturities similar to the estimated duration of the benefit obligations. The expected rate of return on assets corresponds to the discount rate, in accordance with the IAS 19 standard.
The sensitivity of the debt to changes in the discount rate is shown in the table below:
Medical expenses and other employee benefits
Pension benefits
Total 5,113 5,529 4,742
€ million
Commitments at 30.06.2019
4,965 5,372 4,603
147 157 138
Commitments at 30.06.2019 with a 0.5% decrease in the discount rate Commitments at 30.06.2019 with a 0.5% increase in the discount rate
The impact of a change in the rate of increase in medical expenses would be as follows:
Effect of a change
In respect of post-employment medical coverage € millions On the present value of the benefit obligations at 30.06.2019
With current rate
1% increase
1%decrease
113
12
(10)
Expense for FY19
5
0
0
185
2018-2019
PERNOD RICARD UNIVERSAL REGISTRATIONDOCUMENT
Made with FlippingBook - professional solution for displaying marketing and sales documents online