PERNOD-RICARD - URD 2021-22 EN

Annual consolidated financial statements Notes to the consolidated financial statements

Inventories and work in progress Note 4.4

Inventories are measured at the lower of either their cost (acquisition cost and cost of production, including indirect production overheads) or their net realisable value. Net realisable value is the selling price less the estimated costs of completion and sale of inventories. Most inventories are valued using the weighted average cost method. The cost of long-cycle inventories is computed using a single method which includes distilling and ageing costs. These inventories are classified in current assets, although a substantial part remains in inventory for more than one year in order to undergo the ageing process used for certain wines and spirits before being sold.

The inventories and work-in-progress are broken down at closing as follow:

Movements of the period

Foreign currency gains and losses

Change in gross values

Change in impairment

Other movements 30.06.2021

30.06.2020

€ million

Raw materials

173

3

- - - - -

(1)

2

177

Work in progress

5,183

214

85

4

5,486

Goods in inventory Finished products

580 296

76 32

(10)

-

646

(3) 72 (0) (0) (0)

6

331

Gross value

6,232

325

11

6,640

Raw materials

(11)

- - - - -

(5) (5) (7) (3)

-

(16) (29) (23)

Work in progress

(23) (16)

(1)

Goods in inventory Finished products

(0)

(15)

0

1 -

(17)

Impairment

(65)

(20)

(0)

(86)

Net inventories

6,167

325

(20)

72

11

6,555

6.

Movements of the period

Foreign currency gains and losses

Change in gross values

Change in impairment

Other movements 30.06.2022

30.06.2021

€ million

Raw materials

177

41

- - - - -

11

(0) (6) (0) (2) (8)

228

Work in progress

5,486

287 188 143 659

85 41 22

5,847

Goods in inventory Finished products

646

876 495

331

Gross value

6,641

158

7,446

Raw materials

(16) (29) (23)

- - - - -

(9) (5)

(1) (1)

0

(15)

Work in progress

2

(24) (24) (14) (77)

Goods in inventory Finished products

(14)

(3)

(0)

(17)

0

(1)

0

Impairment

(86)

(27)

(5)

2

Net inventories

6,555

659

(27)

153

(6)

7,369

At 30 June 2022, ageing inventories intended mainly for use in whisky and cognac production accounted for 83% of work-in-progress. The Group is not significantly dependent on its suppliers.

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Pernod Ricard Universal Registration Document 2021-2022