PERNOD-RICARD - URD 2021-22 EN

6. Annual consolidated financial statements Notes to the consolidated financial statements

Note 3.2

Financial income/(expense)

30.06.2022

30.06.2021

€ million

Interest expense on net financial debt Interest expense on lease liabilities Interest income on net financial debt

(261)

(236)

(13)

(12)

36

48

Net financing cost

(238)

(200)

Structuring and placement fees

(3)

(2)

Net financial impact of pensions and other long-term employee benefits

(17)

(11)

Other net current financial income (expense)

(3)

(1)

Financial income/(expense) from recurring operations

(262)

(215)

Foreign currency gains/(losses)

(37) (73)

(20) (24)

Other non-current financial income/(expenses)

Total financial income/(expenses)

(371)

(260)

Weighted average cost of debt The Group’s weighted average cost of debt was 2.3% over FY22 compared to 2.8% over FY21. Weighted average cost of debt is defined as net financing costs plus structuring and placement fees as a proportion of average net financial debt outstanding plus the average amount outstanding on factoring and securitisation programmes.

At 30 June 2022, the net cost of financial debt included financial expenses of €192 million on bonds, partially offset by the positive impact of interest rate hedges for €20 million, factoring and securitisation agreements for €8 million, interest on lease liabilities for €12 million, and €8 million in other expenses. The financial income/(expense) was also impacted by the early redemption of the bond debt detailed in Note 2.1 – Significant events during the financial year for €24 million, negative foreign exchange impacts for €20 million, and the net impact of pensions and other long-term employee benefits for €11 million.

Note 3.3

Corporate income tax

Analysis of the income tax expense

30.06.2022

30.06.2021

€ million

Current income tax Deferred income tax

(425) (242)

(580)

(97)

Total

(667)

(676)

Analysis of effective tax rate – Net profit from continuing operations before tax

30.06.2022

30.06.2021

€ million

Operating profit

2,361

2,963 (260) 2,703

Financial income/(expense)

(371)

Taxable profit

1,990

Theoretical tax charge at the income tax rate in France

(637)

(768)

Impact of tax rate differences by jurisdiction Tax impact of variation in exchange rates

218

211

7

(14)

Re-estimation of deferred tax assets linked to tax rate changes

(193)

5

Impact of tax losses used/not used

40

(8)

Impact of reduced/increased tax rates on taxable results

0

0

Taxes on distributions

(31) (72)

(35) (67)

Other impacts

Effective income tax expense

(667)

(676)

Effective tax rate

34%

25%

212

Pernod Ricard Universal Registration Document 2021-2022