Valeo Foods Germany Bidco GmbH (vormals: Blitz H20-198 GmbH)

Hamburg

Befreiender Konzernabschluss zum Geschäftsjahr vom 01.04.2020 bis zum 31.03.2021

Valeo Foods Unlimited Company

Dublin/Irland

Directors' report and consolidated financial statements

Year ended 31 March 2021

Registered number: 488248

Directors' report and consolidated financial statements

Contents

Directors and other information

Directors' report

Statement of directors' responsibilities in respect of the directors' report and the financial statements

Independent auditor's report to the members of Valeo Foods

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of financial position

Consolidated statement of changes in equity

Consolidated statement of cash flows

Notes forming part of the consolidated financial statements

Company balance sheet

Company statement of changes in equity

Company statement of cash flows

Notes forming part of the Company financial statements

Directors and other information

Board of directors	S Fitzpatrick
	J Rodrigues
	K Briant
	O Khelladi
	S Kearney
	B Feeney
Secretary	Beacon Company Secretaries Limited
Registered office	Commercial House
	Millbank Business Park
	Lucan, Co. Dublin
Auditor	KPMG
	Chartered Accountants
	1 Stokes Place
	St. Stephen's Green
	Dublin 2
Bankers	Bank of Ireland plc
	Baggot Street
	Dublin 2
	Allied Irish Banks plc
	Block C2
	AIB Bankcentre
	Dublin 4
	JP Morgan Limited
	25 Bank Street
	Canary Wharf
	London E14 5JP
	Wilmington Trust (London) Limited
	1 King's Arms Yard
	London EC2R 7AF
	Ulster Bank Ireland Limited
	Ulster Bank Jersey Centre
	George Quay
	Dublin 2
Solicitors	Arthur Cox
	Earlsfort Terrace
	Dublin 2
Registered number	488248

Directors' report

The directors present their directors' report and the audited consolidated financial statements of Valeo Foods ("VF", the "Company") and its direct and indirect subsidiary companies (together "Valeo", the "Group") for the financial year ended 31 March 2021.

Principal activities

Valeo Foods acts as a holding company. The Company's subsidiaries undertake manufacturing and distribution of food and beverage products in the wholesale, retail and catering trades in the United Kingdom, Ireland and continental European markets.

Business review

The Group delivered a solid year-on-year performance despite ongoing challenges in its retail and economic environment. In particular, the Company had to contend with the impact of the COVID-19 pandemic on economic activity and consumer confidence in the markets in which Valeo operates and sells its products. The Group's turnover and EBITDA both increased on a like-for-like, pro-forma, annualised basis for the financial year ended 31 March 2021 compared to the previous financial year. Valeo's ambient grocery business performed well due to higher levels of household consumption and in- home dining during the lockdown periods in the Group's key markets. However, Valeo's results in the foodservice and impulse categories were negatively impacted by the effects of lockdown restrictions.

Valeo completed the acquisition of two leading food businesses, (It's All Good Limited (UK) and Schluckwerder Holding GmbH (Germany)), in the second half of the financial year ended 31 March 2021.

Sale of Valeo to Bain Capital Private Equity

On 10 May 2021, funds managed by Valeo's majority financial shareholder, CapVest Partners LLP, agreed the sale of the Group to Bain Capital Private Equity, a leading global private investment firm, for an undisclosed consideration. This sale is not expected to result in any significant changes to the day-to- day management of the Group or in the execution of the Group's strategy.

Covid-19 impact

Now into its second year, the COVID-19 pandemic continues to be the most challenging public health emergency of recent decades and has affected human life, societies and economies on a global scale. Valeo has relentlessly focused on the health, safety and wellbeing of its employees and customers, and business performance has remained resilient to date during the pandemic.

As at the date of signing of these financial statements for the financial year ended 31 March 2021:

•	Demand for Valeo's core ambient grocery products remains solid in general terms, with continuing stable levels of orders in the UK and Ireland dry grocery channel. There has been a broadly positive impact on demand for several of the key categories in which the Group competes including honey, flour, pasta and canned goods. However, this positive impact has moderated somewhat in the second half of the financial year compared to the early stages of the pandemic.
•	Pandemic related restrictions have adversely affected demand in the Group's impulse and HORECA (HOtels, REstaurants and CAtering) businesses in the UK, Ireland and Czech Republic. Valeo has responded to these reduced levels of demand by working closely with customers to address their changing needs and also by right-sizing the cost base of its affected businesses, reducing the working week of impacted teams and, where necessary, furloughing staff.
•	The Group's production and distribution facilities across Ireland, the UK and Europe generally continue to operate as normal. Valeo has experienced minimal lost production days and minimal supply chain interruptions arising from the effects of the pandemic.
•	The pandemic has not materially impacted the Group's liquidity position and Valeo is satisfied that its current sources of funding are appropriate for the requirements of its business. In August 2020, the Group and its syndicate of debt providers agreed changes to Valeo's senior and second lien debt documentation. These changes included an extension in the maturity of the Group's existing senior and second lien debt facilities, revised interest margin rates as well as certain minor amendments to the Group's debt documentation. Elements of the Group's debt facilities were further competitively re-priced in February 2021 concurrent with Valeo's acquisition of Schluckwerder Holding GmbH.
•	There have been no noticeable adverse changes in the Group's working capital position and Valeo continues to tightly monitor discretionary operating and capital expenditure.
•	Valeo management continue to assess and reviews the expected impact of the pandemic on all aspects of operations and have implemented changes as required.

Brexit impact

There has been no significant impact on Valeo's performance arising from the UK's departure from the European Union. The impact of Brexit has been partially mitigated through comprehensive internal Valeo preparation and planning in the months preceding the UK's departure date. In advance of the end of the EU exit transition period, the Group developed a comprehensive set of mitigation plans and preparations to ensure continuity of supply of its products and to protect against trade disruption and pricing volatility.

The EU-UK Trade & Cooperation Agreement has reduced uncertainty surrounding issues such as tariffs and, while some issues have still to be worked through, no significant impact to Valeo's financial performance is expected.

Longer term trading outlook

The pandemic's longer term impact on Valeo's trading performance and prospects remains uncertain. As at the date of signing these financial statements, health authorities in Valeo's key geographies are continuing to progressively vaccinate local populations and this is resulting in an easing of pandemic restrictions in certain countries. However, given the unpredictable nature of the COVID-19 crisis to date (e.g. the potential for the emergence of new COVID-19 viral mutants), the overall situation will remain uncertain for some time. For this reason, Group management continues to monitor developments in its markets regularly and closely.

Notwithstanding this uncertainty, the directors believe that Valeo is still well placed to grow in the current and future years. The Group's strategy remains broadly unchanged despite the pandemic. Valeo will continue to pursue growth through a focus on organic sales growth and maintaining its existing sales base, maximising sales margin performance through effective pricing and promotion strategies, leveraging the Group's purchasing power and maintaining an efficient cost base. Valeo will also continue its disciplined approach to value accretive M&A activity which has been a significant driver of growth in recent years.

Acquisition and disposal activity

The Group concluded two acquisitions during the financial year ended 31 March 2021.

•	On 22 December 2020, the Group announced the purchase of It's All Good ("IAG"), the leading producer of premium tortilla snacks in the UK including the award winning Manomasa range of premium chips.
•	On 12 February 2021, the Group announced its acquisition of the Schluckwerder group of companies from German private equity firm Novum Capital. Schluckwerder is the leading specialist producer of confectionery products popular throughout Germany and internationally.

Valeo did not dispose of any businesses or subsidiaries during the financial year ended 31 March 2021.

Principal risks and uncertainties

The Group operates in an environment that contains risks and uncertainties. Risks arising from the COVID-19 pandemic have been outlined earlier in this directors' report. Detail on other risks and their management and mitigation by the Group is described below:

•	The food sector and ambient grocery in particular is characterised by high levels of competitive intensity. Valeo faces intense competition in its marketplaces and failure to compete successfully would adversely impact on its market share and profitability. The Group continues to provide its customers with a range of products at appropriate prices.
•	The Group may be adversely impacted by changes in foreign currency rates and interest rates. To date, the Group has typically managed risk exposures related to volatility in foreign currency and interest rates through the use of forward contracts and interest rate caps. The Group does not engage in speculative hedging activity (see further comments on financial risk management below).
•	Production capability and efficient distribution processes are key to the Group's continued growth. Disruptions or weaknesses to these processes would impact the Group's profitability. The Group continues to employ suitable personnel and utilise comprehensive IT systems to maintain appropriate service levels with customers.
•	Consumer tastes change and a failure by the Group to identify and meet these changing tastes may impact on volumes and profitability. The Group employs appropriate staff and carries out regular tasting and testing of both its products and its competitors' offerings to monitor and manage this risk.
•	The Group is subject to stringent health, safety and environmental laws and changes in these laws may increase the costs of compliance and adversely impact on profitability. The COVID-19 pandemic has resulted in additional health, safety and environmental laws that have resulted in some additional costs for the Group's business. However, these are not expected to materially impact profitability.
•	Accidental, natural or malicious contamination of products is always a risk in the areas of business in which the Group operates. The Group complies with industry standards to minimise the risk of such contamination and carries appropriate insurance to reduce financial implications of such events.
•	The Group currently distributes third party products by agreement and there is no certainty that these agreements will be renewed when they expire, which could lead to a decline in sales and profitability.
•	Valeo has attracted a high-quality senior management team and staff. The Group will continually face risks associated with the potential loss of key management personnel. The Board addresses these risks through incentivisation and retention initiatives in addition to robust succession planning.

Financial risk management

The Group is exposed to interest rate movements. The Group's debt is denominated in Euro and Pounds Sterling. The Group's interest cost is managed through interest rate caps.

The Group is also subject to the risk of adverse movements in foreign exchange rates. This risk is managed through the use of forward currency contracts to eliminate the currency exposure on certain foreign currency purchases. The Group has a 12-month maximum hedging policy on foreign currency except where directly approved by the Board.

Results and dividends

The consolidated income statement and consolidated statement of financial position for the year are set out in detail on pages 11 to 14.

Group turnover for the year ended 31 March 2021 was €1,021.1 million (2020: €942.7 million).

The loss before taxation for the year was €102.7 million (2020: profit of €53.3 million). This includes once off exceptional net costs of €113.1 million, the largest component of which relates to the impairment of goodwill in respect of one of the Group's businesses. On a like for like basis, excluding exceptional items, the Group made a profit before tax for the period of €10.4 million (2020: profit of €25.3m).

No dividends were proposed or paid in the year ended 31 March 2021 or the prior year.

Accounting records

The directors believe that they have complied with the requirements of Section 281 to 285 of the Companies Act 2014 with regard to maintaining adequate accounting records by employing persons with appropriate expertise and by providing adequate resources to the financial function.

The Group and Company accounting records are kept at Skybridge House, Corballis Road North, Dublin Airport, Co. Dublin, Ireland, K67 P6K2.

Directors

The directors of the Company, all of whom served throughout the year and for the subsequent period to date, are set out below:

S Fitzpatrick

J Rodrigues

K Briant

O Khelladi

S Kearney

B Feeney

Directors' interests

The directors do not hold any interests in the shares of the Company or its subsidiary undertakings at 31 March 2021 or 31 March 2020 that require disclosure. There are other equity related incentive programmes in which the directors are eligible to participate.

Political donations

The Company made no political donations during the year (2020: €Nil).

Relevant audit information

The directors believe that they have taken all steps necessary to make themselves aware of any relevant audit information and have established that the Group's statutory auditor is aware of that information. In so far as they are aware, there is no relevant audit information of which the Group's statutory auditor is unaware.

Subsequent events

On 10 May 2021, funds managed by Valeo's majority financial shareholder, CapVest Partners LLP, agreed on the sale of the Group to Bain Capital Private Equity, a leading global private investment firm, for undisclosed consideration. This sale is not expected to result in any significant changes to the day-to- day management of the Group or in the execution of the Group's strategy.

There are no other significant post balance sheet events that would require disclosure in the financial statements.

Audit committee

The Audit Committee of the board of directors of Valeo Foods Group Limited assists the board in its oversight of the integrity of the financial statements of the Group, of the Group's compliance with legal and regulatory requirements, of the independence and qualifications of the independent auditor and of their performance.

Auditor

Pursuant to Section 383(2) of the Companies Act 2014, the auditor, KPMG, Chartered Accountants, will continue in office.

On behalf of the board

27 August 2021

S Kearney, Director

B Feeney, Director

Statement of directors' responsibilities in respect of the directors' report and the financial statements

The directors are responsible for preparing the directors' report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law they have elected to prepare the Group financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and the Company financial statements in accordance with FRS 101 Reduced Disclosure Framework and applicable law.

Under company law the directors must not approve the Group and Company financial statements unless they are satisfied that they give a true and fair view of the assets, liabilities and financial position of the Group and Company and of the Group's profit or loss for that year. In preparing the Group and Company financial statements, the directors are required to:

•	select suitable accounting policies and then apply them consistently;
•	make judgements and estimates that are reasonable and prudent;
•	state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
•	assess the Group and Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
•	use the going concern basis of accounting unless they either intend to liquidate the Group or Company or to cease operations, or have no realistic alternative but to do so.

The directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the assets, liabilities, financial position and profit or loss of the Company and which enable them to ensure that the financial statements are prepared in accordance with the applicable accounting framework and comply with the provisions of the Companies Act 2014. They are responsible for such internal controls as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities. The directors are also responsible for preparing a directors' report that complies with the requirements of the Companies Act 2014.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

On behalf of the board

27 August 2021

S Kearney, director

B Feeney, Director

Independent auditor's report to the members of Valeo Foods

Report on the audit of the financial statements

Opinion

We have audited the financial statements of Valeo Foods ("the Company") and its consolidated undertakings ("the Group") for the year ended 31 March 2021 set out on pages 11 to 69, which comprise the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of financial position, the Company balance sheet, the consolidated and company statement of changes in equity, the consolidated and company statement of cash flows and related notes, including the summary of significant accounting policies set out in note 2. The financial reporting framework that has been applied in the preparation of the Group financial statements is Irish Law and International Financial Reporting Standards (IFRS) as adopted by the European Union and, as regards the Company financial statements, Irish Law and FRS 101 Reduced Disclosure Framework issued in the United Kingdom by the Financial Reporting Council.

In our opinion:

•	the financial statements give a true and fair view of the assets, liabilities and financial position of the Group and Company as at 31 March 2021 and of the Group's loss for the year then ended;
•	the Group financial statements have been properly prepared in accordance with IFRS as adopted by the European Union;
•	the Company financial statements have been properly prepared in accordance with FRS 101 Reduced Disclosure Framework issued by the UK's Financial Reporting Council; and
•	the financial statements have been properly prepared in accordance with the requirements of the Companies Act 2014.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with ethical requirements that are relevant to our audit of financial statements in Ireland, including the Ethical Standard issued by the Irish Auditing and Accounting Supervisory Authority (IAASA), and we have fulfilled our other ethical responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the Company's ability to continue as a going concern for a period of at least twelve months from the date when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information presented in the Annual Report together with the financial statements. The other information comprises the information included in the directors' report. The financial statements and our auditor's report thereon do not comprise part of the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work we have not identified material misstatements in the other information.

Based solely on our work on the other information undertaken during the course of the audit, we report that:

•	we have not identified material misstatements in the directors' report;
•	in our opinion, the information given in the directors' report is consistent with the financial statements;
•	in our opinion, the directors' report has been prepared in accordance with the Companies Act 2014.

Opinions on other matters prescribed by the Companies Act 2014

We have obtained all the information and explanations which we consider necessary for the purposes of our audit.

In our opinion the accounting records of the Company were sufficient to permit the financial statements to be readily and properly audited and the financial statements are in agreement with the accounting records.

Matters on which we are required to report by exception

The Companies Act 2014 requires us to report to you if, in our opinion, the disclosures of directors' remuneration and transactions required by Sections 305 to 312 of the Act are not made. We have nothing to report in this regard.

Respective responsibilities and restrictions on use

Responsibilities of directors for the financial statements

As explained more fully in the directors' responsibilities statement set out on page 7, the directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Group and Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A fuller description of our responsibilities is provided on IAASA's website at

http://www.iaasa.ie/Publications/Auditing-standards/International-Standards-on-Auditing-for-use-in-Ire/Description-of-the-auditor-s-responsibilities-for.

The purpose of our audit work and to whom we owe our responsibilities

Our report is made solely to the Company's members, as a body, in accordance with Section 391 of the Companies Act 2014. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

30 August 2021

KPMG
Chartered Accountants, Statutory Audit Firm

Niall Savage

for and on behalf of

1 Stokes Place

St. Stephen's

Green Dublin 2

Consolidated income statement for the year ended 31 March 2021

	Note	Pre-exceptional 2021	Exceptional 2021
		€'000	€'000
Revenue - continuing operations	4	1,021,080	-
Cost of sales		(609,808)	-
Gross profit		411,272	-
Operating costs	6	(334,669)	(6,019)
Impairment	6	-	(98,995)
Other income	7	3,809	-
Operating profit/(loss)		80,412	(105,014)
Finance income	9	6,346	-
Finance expense	9	(76,389)	(8,081)
Profit/(loss) before tax		10,369	(113,095)
Tax income/(expense)	10	4,328	-
Profit/(loss) for the year		14,697	(113,095)

	Total 2021	Pre-exceptional 2020	Exceptional 2020	Total 2020
	€'000	€'000	€'000	€'000
Revenue - continuing operations	1,021,080	942,743	-	942,743
Cost of sales	(609,808)	(572,280)	-	(572,280)
Gross profit	411,272	370,463	-	370,463
Operating costs	(340,688)	(306,306)	32,938	(273,368)
Impairment	(98,995)	-	(4,978)	(4,978)
Other income	3,809	-	-	-
Operating profit/(loss)	(24,602)	64,157	27,960	92,117
Finance income	6,346	5,752	-	5,752
Finance expense	(84,470)	(44,600)	-	(44,600)
Profit/(loss) before tax	(102,726)	25,309	27,960	53,269
Tax income/(expense)	4,328	(438)	-	(438)
Profit/(loss) for the year	(98,398)	24,871	27,960	52,831

Consolidated statement of comprehensive income for the year ended 31 March 2021

	Note	2021	2020
		€'000	€'000
(Loss)/profit for the year		(98,398)	52,831
Other comprehensive (expense)/income Items that will not be reclassified to the income statement
Re-measurements of post-employment benefit obligations net of asset returns	20	(3,457)	3,249
Deferred tax on defined benefit pension schemes		427	(412)
		(3,030)	2,837
Items that may be reclassified to the income statement
Currency translation differences		30,411	(9,156)
Currency translation on disposal of business		-	107
Mark to market on cash flow hedges		(83)	325
Deferred tax on fair value adjustments		189	(183)
		30,517	(8,907)
Total comprehensive (loss)/income for the year, all attributable to owners of the Company		(70,911)	46,761

Consolidated statement of financial position as at 31 March 2021

	Note	2021	2020
		€'000	€'000
Assets
Property, plant and equipment	11	272,206	222,069
Goodwill and intangible assets	12	599,180	646,869
Financial assets	13	1,277	-
Deferred tax assets	10	180	421
Derivative financial instruments	19	118	-
Non-current assets		872,961	869,359
Inventories	14	148,142	124,752
Trade and other receivables	15	336,145	314,331
Derivative financial instruments	19	1,480	1,582
Current income tax assets		3,053	-
Deferred tax assets	10	4,057	1,218
Cash and cash equivalents	16	139,730	110,962
Current assets		632,607	552,845
Total assets		1,505,568	1,422,204

	Note	2021	2020
		€'000	€'000
Equity and liabilities
Equity attributable to equity holders of the Parent
Called up share capital	24	80,824	80,824
Share premium	24	20,261	20,261
Foreign currency translation reserve		21,099	(9,312)
Retained earnings		29,171	130,493
Total equity		151,355	222,266
Liabilities
Borrowings	18	1,008,642	897,715
Post-employment benefit obligations	20	3,215	2,894
Deferred tax liabilities	10	46,878	39,479
Derivative financial instruments	19	-	178
Lease liabilities	22	43,172	36,956
Deferred income	21	1,085	-
Non-current liabilities		1,102,992	977,222
Borrowings	18	9,446	302
Trade and other payables	17	220,631	204,728
Current income tax liabilities		7,232	9,010
Deferred tax liabilities	10	5,458	1,831
Derivative financial instruments	19	1,663	1,505
Lease liabilities	22	6,791	4,215
Deferred income	21	-	1,125
Current liabilities		251,221	222,716
Total liabilities		1,354,213	1,199,938
Total equity and liabilities		1,505,568	1,422,204

On behalf of the board

27 August 2021

S Kearney, Director

B Feeney, Director

Consolidated statement of changes in equity for the year ended 31 March 2021

	Called up share capital	Share premium	Foreign currency translation reserve	Retained earnings	Total equity
	€'000	€'000	€'000	€'000	€'000
At 31 March 2019	80,824	20,261	(263)	74,683	175,505
Profit for the year	-	-	-	52,831	52,831
Other comprehensive income/(expense)
Re-measurements - post employment
benefit obligation	-	-	-	3,249	3,249
Deferred tax on re-measurements	-	-	-	(412)	(412)
Currency translation differences	-	-	(9,156)	-	(9,156)
Currency translation on disposal of
business	-	-	107	-	107
Mark to market on cash flow hedges	-	-	-	325	325
Deferred tax on fair value adjustments	-	-	-	(183)	(183)
Total comprehensive income for the year	-	-	(9,049)	55,810	46,761
At 31 March 2020	80,824	20,261	(9,312)	130,493	222,266
Loss for the year			-	(98,398)	(98,398)
Other comprehensive (expense)/income
Re-measurements - post employment
benefit obligation	-	-	-	(3,457)	(3,457)
Deferred tax on re-measurements	-	-	-	427	427
Currency translation differences	-	-	30,411	-	30,411
Mark to market on cash flow hedges	-	-	-	(83)	(83)
Deferred tax on fair value adjustments	-	-	-	189	189
Total comprehensive Income/(expense) for the year	-	-	30,411	(101,322)	(70,911)
At 31 March 2021	80,824	20,261	21,099	29,171	151,355

Consolidated statement of cash flows for the year ended 31 March 2021

	2021	2020
	€'000	€'000
Cash flows from operating activities
(Loss)/profit after tax	(98,398)	52,831
Adjustments for:
Depreciation of property, plant and equipment	33,866	30,576
Impairment of property, plant and equipment	-	4,978
Amortisation of intangible assets	25,328	21,549
Impairment of intangible assets	98,995	-
(Profit)/loss on disposal of fixed assets	(4,763)	21
Profit on disposal of subsidiary	-	(44,168)
Finance costs (net)	78,124	38,848
Difference in pension costs and settlement gain to payments	(5,363)	341
Tax (income)/expense	(4,328)	438
Changes in working capital
(Increase)/decrease in inventories	(2,648)	14,976
Decrease in trade and other receivables	21,849	3,330
Decrease in trade and other payables	(3,960)	(10,497)
Cash flows from operating activities	138,702	113,223
Interest paid and related costs	(49,713)	(44,071)
Income taxes paid	(8,099)	(5,111)
Net cash flows from operating activities	80,890	64,041
Cash flow from investing activities
Acquisition of subsidiaries, net of cash acquired	(101,966)	(149,457)
Proceeds from the disposal of subsidiary	-	50,376
Purchases of property, plant and equipment	(29,166)	(38,419)
Proceeds from sale of property, plant and equipment	10,117	-
Net cash flows from investing activities	(121,015)	(137,500)
Cash flows from financing activities
Drawdown of borrowings	174,868	161,125
Repayment of borrowings	(77,151)	(6,782)
Issue costs on borrowings	(25,554)	(3,997)
Payments in respect of leases	(5,505)	(2,904)
Net cash flows from financing activities	66,658	147,442
Net increase in cash and cash equivalents	26,533	73,983
Effect of exchange rates on cash and cash equivalents	2,235	476
Cash and cash equivalents at beginning of year	110,962	36,503
Cash and cash equivalents at end of year	139,730	110,962

Notes

forming part of the consolidated financial statements

1 General information

Valeo Foods (the "Company") is an unlimited private company incorporated in the Republic of Ireland. The registered number of the Company is 488248 and the registered office of the Company is Commercial House, Millbank Business Park, Lucan, Co. Dublin.

The Company's ultimate controlling party and parent undertaking of the largest group of undertakings of which the Company is a member and for which group financial statements are prepared is Valeo Foods Group Limited, a Company incorporated in Jersey.

As permitted by European Union (EU) law, the Group financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and their interpretations issued by the International Accounting Standards Board (IASB) as adopted by the EU. They were approved for issue by the board of directors on 27 August 2021.

2 Significant accounting policies

The consolidated financial statements are presented in euro which is the Company's functional currency. All amounts have been rounded to the nearest thousand, unless otherwise stated.

The Group has consistently applied the following accounting policies to all periods presented in these consolidated financial statements.

A Basis of consolidation

i. Business combinations

The Group accounts for business combinations using the acquisition method when control is transferred to the Group. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Transaction costs are expensed as incurred.

ii. Subsidiaries

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases.

iii. Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealised income and expenses arising from intragroup transactions, are eliminated.

B Foreign currency

i. Foreign currency transactions

Transactions in foreign currencies are translated into the respective functional currencies of Group companies at the exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction. Foreign currency differences are recognised in profit or loss, except for foreign currency differences arising from the translation of qualifying cash flow hedges, to the extent that the hedges are effective, which are recognised in other comprehensive income.

ii. Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into euro at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into euro at the exchange rates at the dates of the transactions.

Foreign currency differences are recognised in other comprehensive income and accumulated in the foreign currency translation reserve.

C Revenue

i. Sale of goods

The Group's revenue is primarily derived from the sale of food and beverage products. All revenue relates to revenue from contracts with customers. Contracts with customers include a single performance obligation to sell these products and do not generally contain multiple performance obligations. Revenue comprises the fair value of the consideration receivable for goods sold to third parties in the ordinary course of business. It excludes sales-based taxes and is net of allowances for volume-based rebates.

The transaction price is the contracted price with the customer adjusted for volume-based rebates. Goods are often sold with retrospective volume rebates based on aggregate sales over a certain period of time. Revenue from these sales is recognised based on the price specified in the contract net of estimated rebates. Accumulated experience is used to estimate and provide for rebates and revenue is recognised only to the extent that it is highly probable that a significant reversal will not occur. No element of financing is deemed present as the sales are made with credit terms consistent with market practice and are in line with normal credit terms in the country of operation.

Revenue is recognised when the control of the goods has transferred to the customer, being when the goods are delivered to the customer and there is no unfulfilled obligation that could affect customer acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence have been transferred to the customer and the customer has accepted the goods in accordance with the sales contract. Revenue is recognised at the point in time when delivery to the customer has taken place.

A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before payment is due.

D Employee benefits

i. Employee benefits

Employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

ii. Defined contribution pension plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

iii. Defined benefit pension plans

The Group's net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Group, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income. The Group determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset), taking into account any changes in the net defined benefit liability (asset) during the period as a result of contributions and benefit payments. Net interest expense and other expenses related to defined benefit plans are recognised in profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Group recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

iv. Termination benefits

Termination benefits are expensed at the earlier of when the Group can no longer withdraw the offer of those benefits and when the Group recognises costs for a restructuring.

E Finance income and finance costs

The Group's finance income and finance costs include:

•	interest income;
•	interest expense;
•	the foreign currency gain or loss on financial assets and financial liabilities;
•	the net gain or loss on hedging instruments that are recognised in profit or loss; and
•	the reclassification of net gains or losses previously recognised in other comprehensive income.

Interest income or expense is recognised using the effective interest method.

F Income tax

Income tax expense comprises current and deferred tax. It is recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

IFRIC 23 'Uncertainty Over Income Tax Treatments' clarifies how to apply the recognition and measurement requirements in IAS 12 when there is uncertainty over income tax treatments. The Group had previously accounted for uncertain tax positions in line with the principles of IFRIC 23 and therefore, there is no impact to the Group in 2021 in respect of IFRIC 23.

i. Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes, if any. The judgements applied in respect of accounting for current tax balances, including the application of IFRIC 23 Uncertainty over Income Tax Treatments, are set out in further detail in note 3 below. It is measured using tax rates enacted or substantively enacted at the reporting date.

Current tax assets and liabilities are offset only if certain criteria are met.

ii. Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is not recognised for:

―	temporary differences related to investments in subsidiaries, to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
―	taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Future taxable profits are determined based on business plans for individual subsidiaries in the Group and the reversal of temporary differences. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised; such reductions are reversed when the probability of future taxable profits improves.

Unrecognised deferred tax assets are re-assessed at each reporting date and recognised to the extent that it has become probable that future taxable profits will be available against which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset only if certain criteria are met.

G Inventories

Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the first-in, first-out principle. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity.

H Property, plant and equipment

i. Recognition and measurement

Items of property, plant and equipment are measured at cost, less accumulated depreciation and any accumulated impairment losses.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.

ii. Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Group.

iii. Depreciation

Depreciation is calculated to write off the cost of items of property, plant and equipment less their estimated residual values using the straight-line method over their estimated useful lives, and is generally recognised in profit or loss. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term. Land is not depreciated.

The estimated useful lives of property, plant and equipment for current and comparative periods are as follows:

- buildings:	50 years
- plant and equipment ^* :	5 - 20 years
- right of use asset:	over the lease term as defined by IFRS 16

^* includes motor vehicles. Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

I Intangible assets and goodwill

i. Recognition and measurement

Goodwill

Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated impairment losses. Goodwill is allocated to cash generating units and is not amortised but tested annually for impairment.

Other intangible assets

Other intangible assets, including customer relationships, patents and trademarks that are acquired by the Group and have finite useful lives, are measured at cost less accumulated amortisation and any accumulated impairment losses.

ii. Subsequent expenditure

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in profit or loss as incurred.

iii. Amortisation

Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line method over their estimated useful lives, and is generally recognised in profit or loss. Goodwill is not amortised.

The estimated useful lives for current and comparative periods are as follows:

- trademarks:	3 - 20 years
- customer relationships:	7 - 12 years
- other:	1 - 20 years

Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

J Financial instruments

i. Basic financial assets and financial liabilities - recognition and derecognition

The Group initially recognises basic financial assets (trade and other receivables and cash and cash equivalents) and basic financial liabilities (trade and other payables and borrowings) on the date when they are originated.

Trade and other receivables

Trade receivables are initially measured at their transaction price and other receivables are initially measured at fair value and are thereafter measured at amortised cost using the effective interest rate method less any provision for impairment.

Trade and other payables

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose of the cashflow statements.

The Group de-recognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognised financial assets that is created or retained by the Group is recognised as a separate asset or liability.

The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.

Interest-bearing borrowing

Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in the income statement over the period of the borrowings on an effective interest basis.

Financial assets

Financial asset investments in equities are held at fair value.

ii. Derivative financial instruments and hedge accounting

The Group holds derivative financial instruments to hedge its foreign currency and interest rate risk exposures.

Derivatives are initially measured at fair value; any directly attributable transaction costs are recognised in profit or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are generally recognised in profit or loss.

The Group applies IFRS 9 Financial Instruments, which addressed the classification, measurement and recognition of financial assets and liabilities. The standard provides guidance around expected credit losses. Each division in the Group has prepared an expected credit loss model, following guidance in IFRS 9 to calculate the bad debt provision applicable in each division. The adoption of this model has not resulted in a change to the bad debt provision held.

Cash flow hedges

When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the derivative is recognised in Other Comprehensive Income and accumulated in the hedging reserve. Any ineffective portion of changes in the fair value of the derivative is recognised immediately in profit or loss.

The amount accumulated in equity is retained in other comprehensive income and re-classified to profit or loss in the same period or periods during which the hedged forecast cash flows affect profit or loss or the hedged item affects profit or loss.

If the forecast transaction is no longer expected to occur, the hedge no longer meets the criteria for hedge accounting, the hedging instrument expires or is sold, terminated or exercised, or the designation is revoked, then hedge accounting is discontinued prospectively. If the forecast transaction is no longer expected to occur, then the amount accumulated in equity is reclassified to profit or loss.

K Share capital

Ordinary shares

Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity.

L Impairment

i. Non-derivative financial assets

Financial assets not classified as at fair value through profit or loss are assessed at each reporting date to determine whether there is objective evidence of impairment.

Objective evidence that financial assets are impaired includes:

―	default or delinquency by a debtor and
―	indications that a debtor will enter bankruptcy.

Financial assets measured at amortised cost

In assessing collective impairment, the Group uses historical information on the timing of recoveries and the amount of loss incurred, and makes an adjustment if current economic and credit conditions are such that the actual losses are likely to be greater or lesser than suggested by historical trends.

An impairment loss is calculated as the difference between the asset's carrying amount and the present value of future cash flows discounted at the asset's original effective interest rate. Losses are recognised in profit or loss and reflected in an allowance amount. When the Group considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, then the previously recognised impairment loss is reversed through profit or loss.

ii. Non-financial assets

At each reporting date, the Group reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. Goodwill is tested annually for impairment.

For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGUs. Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU.

An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment losses are recognised in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

M Leases

The Group accounts for leases in accordance with IFRS 16 Leases, recognising a right of use asset and a lease liability at the lease commencement date.

Under IFRS 16 a contract is, or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The right of use asset is initially measured at cost and subsequently at cost less accumulated depreciation and impairments, and adjusted for certain remeasurements of the lease liability. The cost of the right of use includes the lease liability recognised, and any initial direct costs, restoration costs and payments made on or before the lease commencement date less any lease incentives received.

The right of use asset is depreciated on a straight-line basis over the useful life of the asset. Right of use assets are subject to impairment testing.

The lease liability is initially measured as the present value of the lease payments to be made over the term of the lease, discounted using the rate implicit in the lease, or where this is not available, the Group's incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate. Lease payments include fixed and variable lease payments, and amounts expected to be paid under residual value guarantees. Lease payments also include the exercise price of a purchase option where the Group is reasonably certain that they will exercise the option and also any termination costs associated with a lease where the lease term reflects the termination of the lease.

The lease liability is subsequently increased by the interest cost of the lease liability and decreased by lease payments made. The lease liability is remeasured when there is a change in future lease payments as a result of a change in an index or rate, a change in the amount expected to be paid under a residual value guarantee, or a change in assessment of whether a purchase or termination option is reasonably expected to be exercised or not exercised. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. The Group has availed of the practical expedient not to separate lease components from any associated non-lease components.

The Group has applied judgement in determining the lease term for leases where they are the lessee and the lease contract contains renewal and/or termination options. The assessment of whether the Group is reasonably certain to exercise such options impacts the lease term which in turn impacts the right of use asset and lease liability recognised.

The Group presents the right-of-use assets that do not meet the definition of investment property in 'property, plant and equipment' in the statement of financial position.

The Group has elected not to recognise right-of-use assets and lease liabilities for leases of low value assets and short-term leases, including IT equipment. The Group recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

N Fair value measurement

"Fair value' is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or, in its absence, the most advantageous market to which the Group has access at that date. The fair value of a liability reflects its non-performance risk.

A number of the Group's accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

When one is available, the Group measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

If there is no quoted price in an active market, then the Group uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction.

If an asset or a liability measured at fair value has a bid price and an ask price, then the Group measures assets and long positions at a bid price and liabilities and short positions at an ask price.

The best evidence of the fair value of a financial instrument on initial recognition is normally the transaction price - i.e. the fair value of the consideration given or received. If the Group determines that the fair value on initial recognition differs from the transaction price and the fair value is evidenced neither by a quoted price in an active market for an identical asset or liability nor based on a valuation technique for which any unobservable inputs are judged to be insignificant in relation to the measurement, then the financial instrument is initially measured at fair value, adjusted to defer the difference between the fair value on initial recognition and the transaction price. Subsequently, that difference is recognised in profit or loss on an appropriate basis over the life of the instrument but no later than when the valuation is wholly supported by observable market data or the transaction is closed out.

O Government grants

The Group recognises grants related to assets initially as deferred income at fair value if there is reasonable assurance that they will be received and the Group will comply with the conditions associated with the grant; they are then recognised in profit or loss as other income on a systematic basis over the useful life of the asset.

P Exceptional items

The Group has adopted an income statement format which seeks to highlight significant items within the Group's results for the year. The Group believes that this presentation provides a more informative analysis as it highlights one-off items. Exceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further understanding of the financial performance of the Group. They are material items of income or expense that are shown separately due to the significance of their nature or amount.

Q Standards issued but not yet effective

Recent accounting pronouncements

The IASB have issued the following standards, policies, interpretations and amendments with an effective date of 1 January 2020 and which were applied for the first time in the year ended 31 March 2021:

•	Amendments to References to Conceptual Framework in IFRS Standards
•	Definition of Material (Amendments to IAS 1 and IAS 8)
•	Definition of a Business (Amendments to IFRS 3)
•	Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7)

The adoption of the above new standards and interpretations did not have a significant impact on the Group's consolidated financial statements.

Adopted IFRS not yet applied

The following IFRSs have been issued but have not been applied in these financial statements. Their adoption is not expected to have a material effect on the financial statements:

•	COVID-19 Related Rent Concessions (Amendments to IFRS 16, effective 1 June 2020)
•	Interest Rate Benchmark Reform - Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, effective 1 January 2021)
•	Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37, effective 1 January 2022)
•	Annual Improvements to IFRS Standards 2018-2020 (effective 1 January 2022)
•	Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16, effective 1 January 2022)
•	Reference to the Conceptual Framework (Amendments to IFRS 3, effective 1 January 2022)
•	Classification of Liabilities as Current or Non-current (Amendments to IAS 1, effective 1 January 2023)
•	IFRS 17 Insurance Contracts and amendments to IFRS 17 Insurance Contracts (effective 1 January 2023)

3 Critical accounting estimates and judgements

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. These estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

(a) Impairment of goodwill

The Group tests annually whether goodwill has suffered any impairment in accordance with the accounting policy set out in note 2. The recoverable amounts of the cash generating units have been determined based on value-in-use calculations. The Group applies a conservative approach to ensuring there is no impairment to the carrying value of goodwill using applied long-term sales growth rates between 1 % and 3% growth.

(b) Intangible assets (other than goodwill)

The valuation of intangible assets and their estimated useful lives are determined at acquisition date and reviewed at each statement of financial position date.

(c) Trade receivables

The Group uses an allowance matrix to measure Expected Credit Loss (ECL) of trade receivables from customers. Loss rates are calculated using a three year average of actual losses incurred and adjusted for any anticipated future changes.

This is an area of estimation.

(d) Income tax

There are some transactions and calculations for which the ultimate tax determination is uncertain. The Group recognises liabilities for tax based on estimates of whether additional taxes will be due.

The decision to recognise deferred tax assets, or not, also requires judgement as it involves an assessment of future recoverability of those assets.

Provisions for taxes require judgement in interpreting tax legislation, current case law and / or practice. It may be unclear how tax law or practice applies to a particular transaction or set of circumstances. In some instances, this may not be known until a tax authority or a court makes a decision in an examination, audit or appeal. The Group considers such uncertain tax positions together or separately depending on which approach better predicts how the uncertainties can be resolved. Where the Group concludes it is not probable that a tax authority will fully accept its assessment of an uncertain tax position, it reflects the effect of the uncertainty as either the most likely amount or the expected value. Both the evaluation of the tax authority position and the assessment of the effect of uncertainty involve judgement. In addition, the Group recognises deferred tax assets, mainly relating to unused tax losses when it is probable that the assets will be recovered through future profitability and planning. The assessment of recoverability involves judgement.

4 Segment information

In line with the requirements of IFRS 8 Operating Segments, the Group has identified its Chief Operating Decision Maker ("CODM"). This is considered to be the Board of Directors. The Board reviews the Group's internal reporting in order to assess the performance of the Group and allocate resources.

Operating segments are reported in a manner consistent with the internal reporting provided to the Board.

The Board reviews the performance of the operating segments based on underlying EBITDA which is believed to be the most appropriate measure of underlying performance. Underlying EBITDA is operating profit before interest and tax, excluding depreciation, amortisation charges on intangible assets, shareholder charges and exceptional items (revenues and costs which are considered to be non-recurring in nature for internal decision-making purposes as they relate to specific strategic projects and other internal restructurings), if any.

The Board has determined that the Group has three operating segments, namely Valeo UK, Valeo Ireland and Valeo Europe, reflecting the structure and organisation of the Group. The Board has also determined that these segments have characteristics sufficiently similar that they can be expected to have essentially the same future prospects. On this basis, the Board has determined that the aggregation criteria set out in IFRS 8, Operating Segments, are satisfied.

Segment revenue	2021	2020
	€'000	€'000
Revenue	1,021,080	942,743
Segment results
Operating profit before exceptional items	80,412	64,157
Exceptional net (costs)/gains	(105,014)	27,960
Finance costs (net)	(78,124)	(38,848)
(Loss)/profit before tax as reported	(102,726)	53,269

The Group's principal markets are the UK, Ireland and Europe. The Group's revenues are derived from the following principal geographic locations (the comparative balances have been updated to align to the operating segments as noted above):

	2021	2020
	€'000	€'000
UK	492,351	433,872
Ireland	310,014	289,963
Europe	178,368	121,699
Global export	40,347	97,209
Revenue	1,021,080	942,743

Turnover of the Group's top customer is in excess of 10% of turnover of the Group. In aggregate the Group's top 3 customers comprise circa 24% the Group's total turnover.

Segmental assets/liabilities

A geographical analysis of non-current assets (excluding financial instruments and deferred tax assets) is as follows:

	2021	2020
	€'000	€'000
UK	384,328	346,127
Ireland	213,451	225,428
Europe	274,884	297,383
Non-current assets	872,663	868,938

Segment assets, liabilities and capital expenditure are as follows:

	2021	2020
	€'000	€'000
Operating segment assets
Total segment assets	1,356,951	1,308,021
Unallocated assets	148,617	114,183
Total assets	1,505,568	1,422,204
Operating segment liabilities
Total segment liabilities	(220,631)	(204,728)
Unallocated liabilities	(1,133,582)	(995,210)
Total liabilities	(1,354,213)	(1,199,938)
Capital expenditure
Aggregated segment capital expenditure	29,166	38,419

5 Statutory information	2021	2020
	€'000	€'000
The (loss)/profit before tax, all of which arises from continuing operations, is stated after charging:
Directors' remuneration:
- for services as directors	1,032	920
- pension costs	55	49
	1,087	969
Auditor's remuneration:
- Audit of the Company financial statements (including outlay)	5	5
- Audit of the Group financial statements (including outlay)	589	545
- Other assurance services	3	3
- Tax-advisory services	23	115
- Other non-audit services	300	43
	920	711

6 Exceptional costs	2021	2020
	€'000	€'000
Impairment
Goodwill impairment costs	98,995	-
Manufacturing asset impairment costs	-	4,978
	98,995	4,978
Operating expenses
Gain on disposal of business	-	(44,168)
Business acquisition costs	5,003	5,843
Restructuring costs	1,941	2,935
Other project costs	1,358	2,387
Net (gain)/loss on sale of property, plant and equipment	(4,763)	21
Non-recurring business costs	2,480	44
	6,019	(32,938)
Finance costs (net)
Refinancing costs	8,081	-
Total exceptional items	113,095	(27,960)

7 Other income	2021	2020
	€'000	€'000
Defined benefit pension settlement gain (note 20)	(3,809)	-

8 Employee benefit expense	2021	2020
	€'000	€'000
Wages and salaries	136,656	117,019
Social welfare costs	16,523	15,051
Retirement benefit costs:
- defined benefit schemes (excluding settlement gain)	276	298
- defined contribution schemes	4,025	4,335
	157,480	136,703
Severance payments	1,944	1,432
	159,424	138,135

The average number of persons employed by the Group during the year was:

	2021	2020
Production	3,291	2,889
Distribution	489	425
Management and administration	793	691
	4,573	4,005

9 Finance costs (net)	2021	2020
	€'000	€'000
Finance income
Interest income on loans to related companies	6,346	5,752
Exceptional item
Refinancing costs	8,081	-
	8,081	-
Finance costs
Interest expense - bank borrowings	47,008	40,654
Interest expense - other bank costs	79	700
Foreign exchange loss/(gain)	25,250	(825)
Amortisation of deferred banking costs	1,108	1,270
Net pension finance expense	35	84
Lease liability interest	2,909	2,717
Total finance costs	76,389	44,600
Total finance costs (net)	78,124	38,848

10 Income tax	2021	2020
	€'000	€'000
(a) Recognised in the income statement
Current income tax
Irish corporation tax	1,517	18
Foreign corporation tax	10,560	9,059
Adjustments in respect of previous periods	(12,485)	(1,330)
Total current tax	(408)	7,747
Deferred tax
Origination and reversal of temporary differences	(4,737)	(6,681)
Adjustments in respect of previous periods	817	(628)
Total deferred tax	(3,920)	(7,309)
Total income tax (credit)/charge recognised in the income statement	(4,328)	438
Deferred tax - remeasurement of post employee benefit obligation recognised in statement of other comprehensive income	(427)	412
Deferred tax on fair value adjustments recognised in statement of other comprehensive income	(189)	183

(b) Reconciliation of total actual tax

The tax in the income statement for the year differs from the standard rate of corporation tax in the Republic of Ireland of 12.5%. The differences are reconciled below:

	2021	2020
	€'000	€'000
(Loss)/profit before tax	(102,726)	53,269
Tax on (loss)/profit at standard Irish corporation tax rate	(12,841)	6,659
Effects of:
Income tax at higher rates	6,232	2,525
Items not subject to tax including intangible asset charges	18,116	(2,315)
Deferred tax - amortisation of intangibles	(4,167)	(4,473)
Adjustments in respect of prior periods	(11,668)	(1,958)
Total tax (credit)/charge	(4,328)	438

The net tax credit arising from adjustments in respect of prior periods is primarily on account of events during the year ended 31 March 2021 which resulted in the release of uncertain tax positions.

(c) Deferred tax

The Group's deferred tax assets and liabilities are analysed as follows:

	Property, plant and equipment	Acquisition related intangibles	Retirement benefits	Other	Total
	€'000	€'000	€'000	€'000	€'000
At 31 March 2019	5,586	33,997	(569)	(1,490)	37,524
Credit for the year	(1,640)	(4,473)	(263)	(933)	(7,309)
Arising on acquisition	(742)	10,086	-	(483)	8,861
Tax charged to equity	-	-	412	183	595
At 31 March 2020	3,204	39,610	(420)	(2,723)	39,671
Credit for the year	(545)	(4,167)	530	262	(3,920)
Arising on acquisition	1,226	12,455	(103)	(1,027)	12,551
Acquisition fair value adjustment	-	413	-	-	413
Tax charged to equity	-	-	(427)	(189)	(616)
At 31 March 2021	3,885	48,311	(420)	(3,677)	48,099

Deferred tax asset and liabilities are shown in the consolidated statement of financial position as follows:

	2021	2020
	€'000	€'000
Non-current assets	180	421
Current assets	4,057	1,218
Non-current liabilities	(46,878)	(39,479)
Current liabilities	(5,458)	(1,831)
At 31 March	(48,099)	(39,671)

11 Property, plant and equipment	Land and buildings	Plant and equipment	Total
	€'000	€'000	€'000
Cost
At 31 March 2020	101,408	207,621	309,029
Acquisitions - owned use (note 28)	27,668	12,308	39,976
Acquisitions - right of use asset (note 28)	5,620	2,724	8,344
Additions - owned use	1,487	27,679	29,166
Additions - right of use asset (note 22)	1,702	2,508	4,210
Disposals - owned use	(5,833)	(7,165)	(12,998)
Disposals - right of use asset (note 22)	-	(243)	(243)
Exchange translation	4,412	8,775	13,187
At 31 March 2021	136,464	254,207	390,671
Accumulated depreciation
At 31 March 2020	7,427	79,533	86,960
Charge for the year - owned use	2,364	24,615	26,979
Charge for the year - right of use asset (note 22)	4,770	2,117	6,887
Disposals - owned use	(751)	(6,893)	(7,644)
Disposals - right of use asset (note 22)	-	(237)	(237)
Exchange translation	941	4,579	5,520
At 31 March 2021	14,751	103,714	118,465
Net book amount
At 31 March 2021	121,713	150,493	272,206
At 31 March 2020	93,981	128,088	222,069

All Group property, plant and equipment are secured by fixed charges in favour of the providers of Group borrowings.

A reconciliation of the right of use asset balances from 31 March 2020 to 31 March 2021 is disclosed in note 22.

	Land and buildings	Plant and equipment	Total
	€'000	€'000	€'000
Cost
At 31 March 2019	48,375	164,925	213,300
Right of use asset at 31 March 2019 (note 22)	32,022	2,426	34,448
Adjusted balance at 1 April 2019	80,397	167,351	247,748
Additions	2,584	28,159	30,743
Additions - right of use asset (note 22)	4,360	1,639	5,999
Acquisitions (note 22 and note 28)	16,517	21,920	38,437
Disposals	(36)	(2,928)	(2,964)
Reclassification	75	(75)	-
Exchange translation	(2,489)	(8,445)	(10,934)
At 31 March 2020	101,408	207,621	309,029
Accumulated depreciation
At 31 March 2019	2,208	57,250	59,458
Charge for the year	2,554	23,660	26,214
Charge for the year - right of use asset
(note 22)	3,264	1,098	4,362
Impairment (note 6)	-	4,978	4,978
Disposals	(10)	(1,991)	(2,001)
Exchange translation	(589)	(5,462)	(6,051)
At 31 March 2020	7,427	79,533	86,960
Net book amount
At 31 March 2020	93,981	128,088	222,069
At 31 March 2019	46,167	107,675	153,842

12 Intangible assets	Goodwill	Acquisition- related intangibles non-customer related	Acquisition- related intangibles customer related	Total
	€'000	€'000	€'000	€'000
Cost
At 31 March 2020	445,342	129,888	172,912	748,142
Acquisitions (note 28)	37,734	5,590	19,729	63,053
Fair value adjustments (note 28)	(397)	-	-	(397)
Exchange translation	8,582	2,143	5,056	15,781
At 31 March 2021	491,261	137,621	197,697	826,579
Accumulated amortisation
At 31 March 2020	-	35,668	65,605	101,273
Charge for year	-	6,831	18,497	25,328
Impairment (note 6)	98,995	-	-	98,995
Exchange translation	-	344	1,459	1,803
At 31 March 2021	98,995	42,843	85,561	227,399
Net book amount
At 31 March 2021	392,266	94,778	112,136	599,180
At 31 March 2020	445,342	94,220	107,307	646,869

Non-customer acquisition-related intangibles represent all other acquisition-related intangible assets, primarily brands and contract-related intangibles.

The amortisation and impairment charges for the year are included in operating costs and exceptional items, respectively, in the income statement.

	Goodwill	Acquisition- related intangibles non-customer related	Acquisition- related intangibles customer related	Total
	€'000	€'000	€'000	€'000
Cost
At 31 March 2019	398,105	121,209	136,936	656,250
Acquisitions (note 28)	50,257	10,259	40,698	101,214
Fair value adjustments (note 28)	1,541	-	-	1,541
Disposals	-	-	(2,016)	(2,016)
Exchange translation	(4,561)	(1,580)	(2,706)	(8,847)
At 31 March 2020	445,342	129,888	172,912	748,142
Accumulated amortisation
At 31 March 2019	-	30,019	51,323	81,342
Charge for year	-	5,933	15,616	21,549
Disposals	-	-	(353)	(353)
Exchange translation	-	(284)	(981)	(1,265)
At 31 March 2020	-	35,668	65,605	101,273
Net book amount
At 31 March 2020	445,342	94,220	107,307	646,869
At 31 March 2019	398,105	91,190	85,613	574,908

Goodwill acquired in business combinations is allocated, at acquisition, to the cash generating units (CGUs) that are expected to benefit from that business combination. The Group currently has 12 (2020: 12) CGUs.

Impairment test of goodwill and other indefinite life assets

The recoverable amount of the CGUs has been determined based on value in use calculations performed annually, updated in the current year for the estimated effects of the Covid-19 pandemic. These calculations used post tax cash flow projections based on projections to 31 March 2026 reviewed by the board incorporating the estimates noted below.

The key assumptions include management's estimates as follows:

•	Future sales growth of 3% in the Irish business, 6% in the UK business and 4% in the Europe business. These future sales growth rates represent prudent estimates for the purposes of testing the recoverable amounts of the CGUs and are more conservative than the higher sales growth rates which are used for management target setting and incentivisation purposes.
•	Working capital requirements in line with current cyclical working capital trends.

The present values of the future cash flows are calculated using the discount rates equal to the imputed cost of capital of 9.3% (2020: 9.0%) for Ireland, 9.3% (2020: 9.9%) for the UK and 10.2% (2020: 9.9%) for Europe.

Applying these assumptions, no impairment arose in respect of any CGU except in the case of one CGU in the Valeo Europe operating segment which recorded an impairment, recognised as an exceptional item in the income statement (2020: €Nil).

The values applied to the key assumptions are derived from a combination of external and internal factors based on historical experience and take into account management's expectation of future trends affecting the industry and other developments and initiatives in the business.

Sensitivity analysis

Excluding the CGU that is the subject of the impairment, if the estimated cash flow forecasts used in the value in use computations had been 10% lower than management's estimates, or if the estimated pre-tax discount rate applied to the discounted cash flows had been 10% higher than management's estimates, there would have been no requirement to recognise a significant impairment of goodwill.

13 Financial assets	2021	2020
	€'000	€'000
Balance at beginning of year	-	-
Acquisitions (note 28)	1,305	-
Fair value movements	(28)	-
Balance at end of year	1,277	-

Financial assets represent equities held at fair value.

14 Inventories	2021	2020
	€'000	€'000
Raw materials and consumables	63,259	54,692
Finished goods for resale	84,883	70,060
	148,142	124,752

There has been no material write down of inventory to net realisable value (2020: €Nil).

The value of inventories recognised in cost of sales during the year amounted to €609,808,000.

15 Trade and other receivables	2021	2020
	€'000	€'000
Current
Trade receivables	184,126	170,143
Less provision for impaired receivables	(4,885)	(4,671)
Trade receivables - net	179,241	165,472
Prepayments and other receivables	13,622	14,300
VAT	1,448	2,414
Amounts receivable from related companies	141,834	132,145
	336,145	314,331

Amounts receivable from related companies are receivable on demand. Interest rates charged are in the range of 0% to 8%.

The carrying value of trade receivables approximates fair value due to their short-term nature. They are denominated in the following currencies:

	2021	2020
	€'000	€'000
Sterling	78,324	73,105
Euro	101,436	92,814
US$	167	355
Other	4,199	3,869
	184,126	170,143

The movement in the provision for impairment of trade and other receivables during the year is as follows:

	2021	2020
	€'000	€'000
At 1 April	4,671	3,026
Arising on acquisition	131	457
Provision for receivables impairment	218	1,421
Receivables written off during the year as uncollectible	(107)	(50)
Amounts reversed	(28)	(183)
At 31 March	4,885	4,671

As at 31 March 2021 the Group had exposure to concentration risk in respect of its trade receivables as the majority of its customers are retailer multiples. The exposure to such concentration risk was assessed as low, due to a combination of the Group's previous experience in realising such receivables and credit insurance cover which it has in place in respect of 90% of all receivable balances in excess of €5,000.

The Group's top five debtors comprise 31 % of the total balance, with one debtor exceeding 10%.

The ageing analysis of trade receivables based on past due date at each year end is as follows:

	2021	2020
	€'000	€'000
Not due	154,308	147,374
Less than 3 months overdue	21,405	16,714
Between 3 months and 6 months overdue	8,413	6,055
	184,126	170,143
Provision for impaired receivables	4,885	4,671

Trade receivable balances are generally considered for an impairment review when falling outside trade terms and are partially or fully provided based on the 3 year expected credit loss model.

The provision for impaired receivables is as follows:	2021	2020
	€'000	€'000
Less than 3 months overdue	127	880
Over 3 months overdue	4,758	3,791
	4,885	4,671

The other classes within trade and other receivables do not contain any impaired assets. The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.

16 Cash and cash equivalents	2021	2020
	€'000	€'000
Cash at bank and in hand	139,730	110,962

Cash and cash equivalents are reported at amortised cost which approximates fair value. Cash at bank and in hand earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods depending on the immediate cash requirements of the Group and earn interest at the respective short-term deposit rates.

The maximum exposure to credit risk at the reporting date is the carrying value of cash and cash equivalents noted above.

The Group's currency exposure is set out below. Such exposure comprises the cash and cash equivalents of the Group that are denominated other than in Euro. At each year end these exposures were as follows:

	2021	2020
	€'000	€'000
Non-Euro denominated
Sterling	51,977	56,435
US$	1,471	431
CZK	1,928	2,504
Other	113	993

17 Trade and other payables	2021	2020
	€'000	€'000
Current
Trade payables	130,219	128,473
Employment related taxes	4,634	4,521
VAT	4,104	5,398
Other payables	39,493	32,893
Accruals	42,181	33,443
	220,631	204,728

Trade and other creditors are payable at various dates in the next three months in accordance with the suppliers' credit terms.

Certain trade creditors have reserved title to goods supplied.

The carrying value of trade and other payables approximate fair value, due to their short-term nature.

The Group's trade payables are denominated in the following currencies:

	2021	2020
	€'000	€'000
Euro	74,317	70,664
Stg£	54,172	49,814
US$	46	6,643
CZK	1,496	1,256
Other	188	96
	130,219	128,473

18 Borrowings	2021	2020
	€'000	€'000
Bank borrowings	1,033,461	906,107
Other borrowings	-	20
Deferred debt origination costs	(24,819)	(8,412)
Non-current	1,008,642	897,715
Bank borrowings - current	4,849	-
Other borrowings - current	4,597	302
Current	9,446	302
Total borrowings	1,018,088	898,017

The maturity of non-current borrowings is as follows:	2021	2020
	€'000	€'000
Between 1 and 2 years	-	263
Between 2 and 5 years	32,300	807,194
Over 5 years	976,342	90,258
	1,008,642	897,715

In August 2020, the Group and its syndicate of debt providers agreed changes to Valeo's senior and second lien debt documentation. These changes included an extension in the maturity of the Group's existing senior and second lien debt facilities, revised interest margin rates as well as certain minor amendments to the Group's debt documentation. Elements of the Group's debt facilities were further competitively re-priced in February 2021 concurrent with Valeo's acquisition of Schluckwerder Holding GmbH.

Bank borrowings are secured by fixed and floating charges over the assets of the Company and its subsidiaries. The banking facilities under which these loans have been granted primarily expire between 2024 and 2028.

Bank borrowings are denominated in Sterling and Euro and bear floating rate interest. The weighted average all-in interest rate (i.e. base rate plus margin rate) for the year was 5.5%.

At 31 March 2021 the Group had available €35.4 million of undrawn committed borrowing facilities.

Deferred banking fees will amortise over each year to the date of repayment of the bank debt.

Further detail is provided in note 25 and note 26.

19 Derivative financial instruments	Fair value
	2021	2020
	€'000	€'000
Non-current assets
Interest rate cap	118	-
Current assets
Forward currency contracts	1,391	1,580
Oil contracts	89	-
Interest rate cap	-	2
Current assets total	1,480	1,582
Non-current liabilities
Forward currency contracts	-	178
Current liabilities
Forward currency contracts	1,663	1,505

The Group does not use derivatives for trading or speculative purposes.

20 Retirement benefit obligations

The Group operates a number of defined benefit pension and defined contribution pension plans.

Retirement benefit obligations are assessed on an annual basis, in accordance with the advice of a professionally qualified actuary, using the projected unit method.

Defined contribution pension plans

For defined contribution plans, the Group pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

Total contributions to defined contribution plans amounted to €4.0 million (2020: €4.3 million) in the year ended 31 March 2021, which is included in the income statement.

Defined benefit pension plans

During the year, certain of the Group's defined benefit pension schemes commenced wind up procedures, resulting in settlement payments made by the Group and a gain on settlement recognised. As the Group was released from its previous obligations to these defined benefit pension schemes, the scheme liabilities have been extinguished at 31 March 2021 in the notes below. Following these events, the Group's defined benefit schemes are limited to those in mainland Europe.

The Group's defined benefit pension plans, most of which are closed to new members, provide benefits to members in the form of a level of pension payable for life based on accrued benefits to the date of cessation of contribution. The level of benefits provided depends on retired members' length of service and their salary in the final years leading up to retirement. Current deferred members' benefits are based on accrued service. Employer contributions are in line with actuarial recommendations.

The latest funding valuations were carried out at various dates between 2014 and 2017. The expected aggregate cash contributions to defined benefit plans for the year ending 31 March 2022 is €0.1 million (2021: €0.2 million).

Actuarial assumptions

The assumptions used in calculating the accounting costs and obligations of the defined benefit pension plans, as detailed below, are set by the directors after consultation with independent, professionally qualified actuaries.

The discount rate used to determine the present value of the obligations is set by reference to market yields on high quality corporate bonds. The assumptions for price inflation are set by reference to the difference between yields on longer-term conventional government bonds and index-linked bonds with appropriate adjustments to reflect distortions due to supply and demand.

The salary assumption takes into account inflation, seniority, promotion and current employment market relevant to the Group.

The assumptions for life expectancy have been set with reference to the standard mortality tables based on actuarial advice.

	2021	2020
Discount rates	0.72%/1.12%	1.85%-1.95%
	1.50%/1.65%
CPI inflation	1.0%/1.6%	1.0%
Expected rate of salary increases	1.5%/1.6%	1.0%
Expected rate of pension increases	0%-3%	0%-3%
Number of years a current pensioner is expected to live beyond age 65:
- Men	^*	23.4
- Women	^*	25.3
Number of years future pensioners currently aged 45 are expected to live beyond age 65:
- Men	^*	25.2
- Women	^*	27.2

^* not applicable for defined benefit pension schemes which have commenced wind up procedures at 31 March 2021

The table below outlines where the Group's post-employment amounts are included in the financial statements:

	2021	2020
	€'000	€'000
Defined benefit plans - current service cost	276	298
Defined contributions plans	4,025	4,335
Charge to operating expenses	4,301	4,633
Credited to other income - settlement gain	(3,809)	-
Finance costs (net)	35	84
Total (loss)/gain on remeasurement included in other comprehensive income	(3,457)	3,249
Balance sheet obligations
Net liability in the statement of financial position	3,215	2,894

	Present value of obligation	Fair value of plan assets	Liability recognised
	€'000	€'000	€'000
At 31 March 2020	32,316	(29,422)	2,894
Acquisitions (note 28)	2,166	-	2,166
Current service cost	276	-	276
Settlement gain	(3,809)	-	(3,809)
Finance costs (net)	581	(546)	35
Taken to income statement	(2,952)	(546)	(3,498)
Return on plan assets	-	400	400
Experience gains	(222)	-	(222)
Changes in financial assumptions	3,279	-	3,279
Total re-measurements in other comprehensive income	3,057	400	3,457
Employer contributions ^*	-	(2,056)	(2,056)
Employee contributions	57	(57)	-
Benefit payments	(2,237)	2,237	-
Other movements	53	199	252
Settlement transfer ^**	(29,245)	29,245	-
	(31,372)	29,568	(1,804)
At 31 March 2021	3,215	-	3,215

^* Employer contributions include €2,000,000 of payments on settlement of certain defined benefit pension schemes commencing wind up procedures
^** While the defined benefit pension schemes which have commenced wind up procedures are still in the process of winding up at 31 March 2021, the settlement transfer above has offset the assets and liabilities as the Group has no further obligations in respect of these pension schemes

	Present value of obligation	Fair value of plan assets	Liability recognised
	€'000	€'000	€'000
At 31 March 2019	35,667	(29,865)	5,802
Current service cost	298	-	298
Finance costs (net)	601	(517)	84
Taken to income statement	899	(517)	382
Return on plan assets	(37)	(267)	(304)
Change in demographic assumptions	(846)	-	(846)
Experience gains	(62)	-	(62)
Changes in financial assumptions	(2,037)	-	(2,037)
Total re-measurements in other comprehensive income	(2,982)	(267)	(3,249)
Employer contributions	-	(60)	(60)
Employee contributions	57	(57)	-
Settlement payments	(1,323)	1,144	(179)
Other movements	(2)	200	198
	(1,268)	1,227	(41)
At 31 March 2020	32,316	(29,422)	2,894

Experience gains and losses

Asset analysis

An analysis of the total fair value of the respective plan assets at the year-end date is as follows:

	2021	2020
	€'000	€'000
Equities (quoted)	-	13,236
Bonds	-	10,732
Other	-	5,454
Total fair value of assets	-	29,422

Sensitivity of defined benefit obligation in key assumptions

The defined benefit obligations are most sensitive to the discount rate assumptions utilised.

Future benefit payments

The plans' liabilities represent a long-term obligation and most of the payments due under the plans will occur several decades into the future. The table below provides an estimate of the plans' benefit payments to members over the lifetime of the plans.

Years	Benefit payments
	(€'000)
2022-2026	285
2026-2036	800
2036-2046	478

21 Deferred income	2021	2020
	€'000	€'000
Government grants	1,085	1,125
Non-current	1,085	1,125

One of the Group's subsidiaries has received Government grants, which are recognised as income in line with the Group's accounting policy. The Group has ongoing commitments under one of the grant agreements.

22 Leases

In respect of the year ended 31 March 2021

Right of use assets	Land and buildings	Plant and equipment	Total
	€'000	€'000	€'000
Cost
At 31 March 2020	39,129	5,328	44,457
Acquisitions (note 28)	5,620	2,724	8,344
Additions	1,702	2,508	4,210
Disposal	-	(243)	(243)
Foreign exchange translation	1,877	250	2,127
At 31 March 2021	48,328	10,567	58,895
Accumulated depreciation
At 31 March 2020	3,264	1,098	4,362
Charge for the year	4,770	2,117	6,887
Disposal	-	(237)	(237)
Foreign exchange translation	404	100	504
At 31 March 2021	8,438	3,078	11,516
Net book amount
At 31 March 2021	39,890	7,489	47,379
At 31 March 2020	35,865	4,230	40,095

Lease liabilities	€'000
Balance as at 31 March 2020	41,171
Acquisitions (note 28)	8,344
Additions to lease liabilities	4,210
Disposals	(6)
Lease payments	(8,414)
Lease interest	2,909
Foreign exchange translation	1,749
Balance at 31 March 2021	49,963
The maturity of lease liabilities is as follows:	€'000
Less than 1 year	6,791
Between 1 and 5 years	20,130
Over 5 years	23,042
Balance at 31 March 2021	49,963

In respect of the year ended 31 March 2020

Right of use assets	Land and buildings	Plant and equipment	Total
	€'000	€'000	€'000
Balance at 1 April 2019	32,022	2,426	34,448
Acquisitions	3,214	1,434	4,648
Additions	4,360	1,639	5,999
Depreciation charge for the year	(3,264)	(1,098)	(4,362)
Foreign exchange translation	(467)	(171)	(638)
Balance at 31 March 2020	35,865	4,230	40,095

Lease liabilities	€'000
Balance as at 1 April 2019	34,448
Additions to lease liabilities	10,647
Lease payments	(6,003)
Lease interest	2,717
Foreign exchange translation	(638)
Balance at 31 March 2020	41,171

The maturity of lease liabilities is as follows:	€'000
Less than 1 year	4,215
Between 1 and 5 years	14,826
Over 5 years	22,130
Balance at 31 March 2020	41,171

Amounts recognised in profit or loss:	€'000
In respect of the year ended 31 March 2021
Depreciation	(6,887)
Interest on lease liabilities	(2,909)
In respect of the year ended 31 March 2020
Depreciation	(4,362)
Interest on lease liabilities	(2,717)
Expense relating to short-term lease and low value leases	(514)
Amounts recognised in statement of cash flows:	€'000
In respect of the year ended 31 March 2021
Total cash outflow for leases, including those subject to IFRS 16 exemptions	(5,505)
In respect of the year ended 31 March 2020
Total cash outflow for leases, including those subject to IFRS 16 exemptions	(6,078)

23 Analysis of net debt

Net debt is a non-IFRS measure which comprises current and non-current borrowings less cash and cash equivalents. It does not include derivative financial instruments or leases.

The reconciliation of opening to closing net debt is as follows:

	Start of year	Cash flow	Acquisitions	Translation and non-cash adjustments	End of year
Year ended 31 March 2020	€'000	€'000	€'000	€'000	€'000
Cash and cash equivalents	(36,503)	(77,371)	5,604	(2,692)	(110,962)
Bank borrowings	766,173	154,181	278	(14,525)	906,107
Debt origination costs	(5,685)	(3,999)	-	1,272	(8,412)
Other borrowings	627	(386)	81	-	322
31 March 2020	724,612	72,425	5,963	(15,945)	787,055
Year ended 31 March 2021
Cash and cash equivalents	(110,962)	(23,891)	(2,642)	(2,235)	(139,730)
Bank borrowings	906,107	97,717	10,455	24,031	1,038,310
Debt origination costs	(8,412)	(25,554)	-	9,147	(24,819)
Other borrowings	322	497	3,874	(96)	4,597
31 March 2021	787,055	48,769	11,687	30,847	878,358

The year-end currency profile of net debt and derivative financial instruments was as follows:

	Euro	Sterling	Other	Total
	€'000	€'000	€'000	€'000
Cash and cash equivalents	50,599	56,435	3,928	110,962
Borrowings	(458,764)	(439,252)	-	(898,016)
Derivative financial instruments	(1,123)	306	716	(101)
31 March 2020	(409,288)	(382,511)	4,644	(787,155)
Cash and cash equivalents	84,241	51,977	3,512	139,730
Borrowings	(525,021)	(493,067)	-	(1,018,088)
Derivative financial instruments	2,061	(2,370)	244	(65)
31 March 2021	(438,719)	(443,460)	3,756	(878,423)

Reconciliation of movements of interest-bearing loans and borrowings to cash flows arising from financing activities:

	Bank Borrowings	Other Borrowings	Total Borrowings
	€'000	€'000	€'000
Balance at 1 April 2020	906,107	322	906,429
Changes from financing cash flows
Drawdown of borrowings	174,868	497	175,365
Repayment of borrowings	(77,151)	-	(77,151)
Total changes from financing cash flows	1,003,824	819	1,004,643
Changes arising on acquisitions (note 28)	10,455	3,874	14,329
Foreign exchange movement	24,031	(96)	23,935
Balance at 31 March 2021	1,038,310	4,597	1,042,907

24 Share capital

	2021	2020
	€'000	€'000
Authorised
1,000,000 ordinary shares of €1 each	1,000	1,000
99,000,000 redeemable preference shares of €1 each	99,000	99,000
	2021	2020
	€'000	€'000
Issued and fully paid shares of nil par value
101 ordinary shares of €1 each	-	-
80,823,983 redeemable preference shares of €1 each	80,824	80,824

The preference shares are redeemable at the option of the Company and there is no automatic entitlement to dividends.

	2021	2020
	€'000	€'000
Stated capital account (share capital and share premium)	101,085	101,085

No dividends were proposed or paid in the year ended 31 March 2021 or the prior year.

25 Financial instruments and risk management

Financial risk factors

The Group's activities expose it to a variety of financial risks, primarily liquidity risk and foreign exchange risk and counterparty credit risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. The Group does not engage in holding or issuing speculative financial instruments or derivatives.

Risk management is carried out with the assistance of the Group finance team, which manages the Group-wide treasury function. The policy for managing these risks is set by the board following recommendations from the Group Chief Financial Officer.

(a) Liquidity risk

The Group maintains a mixture of short and medium-term debt finance arrangements that are designed to ensure the Group has sufficient available funds to finance its operations. In addition, the Group maintains a committed standby revolving bank facility of €35 million as at 31 March 2021 (2020: €35 million). The Group monitors cash flow as part of its day to day control procedures and the Board considers cash flow projections on a monthly basis ensuring that appropriate facilities are available to be drawn upon as necessary.

Liquidity risk is managed centrally by the Group treasury function. Cash requirements are closely monitored. Cash flow forecasting is performed at the operating entity level and aggregated by Group finance. Group finance monitors rolling forecasts of each individual entity's liquidity requirements to ensure it has sufficient cash to meet operational needs.

All surplus cash is held centrally by the Group treasury function. It seeks to achieve reasonable rates of interest, but preservation of capital is the overriding priority. A list of accepted deposit institutions is maintained and their credit ratings are kept under review.

The maximum exposure to credit risk at each of the period ends was the carrying value of each class of financial assets (being cash and cash equivalents).

The table below analyses the Group's financial liabilities into relevant maturity groupings based on the remaining period at the year-end date to the contractual maturity date. The amounts disclosed are the contractual undiscounted cash flows:

31 March 2021	Less than 1 year	Between 1 and 2 years	Between 2 and 5 years	Over 5 years
	€'000	€'000	€'000	€'000
Bank and other borrowings - capital repayments	9,446	-	32,300	1,001,161
Bank borrowings - interest repayments	50,126	50,126	148,591	78,626
Trade and other payables	220,631	-	-	-
Lease liabilities	6,791	6,185	13,945	23,042
Derivatives	1,663	-	-	-
	288,657	56,311	194,836	1,102,829

31 March 2020	Less than 1 year	Between 1 and 2 years	Between 2 and 5 years	Over 5 years
	€'000	€'000	€'000	€'000
Bank and other borrowings - capital repayments	302	263	815,606	90,258
Bank borrowings - interest repayments	44,901	44,892	112,123	3,728
Trade and other payables	204,728	-	-	-
Lease liabilities	4,215	4,069	10,757	22,130
Derivatives	1,683	-	-	-
	255,829	49,224	938,486	116,116

(b) Foreign exchange risk

The Group sources product for resale internationally and so is exposed to currency risk in the normal course of business on those cost of sales that are denominated in a currency other than the respective functional currencies of Group entities. These currencies primarily comprise Sterling (payables and receivables), US dollar (payables), Australian dollar (payables) and New Zealand dollar (payables). Foreign exchange transaction risk arises when future commercial transaction or recognised assets or liabilities are denominated in a currency that is not the entity's functional currency.

The Group utilises forward exchange contracts to manage this risk.

The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group's foreign operations is managed primarily through borrowings denominated in the relevant foreign currency.

At 31 March 2021, if the Euro had weakened/strengthened by 1% against the UK pound with all other variables held constant, post-tax profit for the year would have been impacted by €7.4 million as a result of foreign exchange gains/losses on translation of UK pound-denominated trade receivables, trade payables and foreign exchange gains/losses on translation of UK pound denominated borrowings. Similarly if Euro had weakened/strengthened by 1% against the Czech koruna, post tax profit for the year would have been impacted by €0.2 million.

(c) Credit risk

Credit risk arises from cash and cash equivalents, derivative financial instruments and credit exposures to customers, including outstanding receivables and committed transactions.

The Group has a credit policy in place and monitors credit risk on an ongoing basis. Credit risk is managed by the central treasury function. The utilisation of credit limits is regularly monitored. The majority of revenues are generated from the larger Irish multiples, with no history of any material bad debt losses. The Group also maintains credit insurance, details of which are set out in note 15.

(d) Interest rate risk

The Group's objective in relation to interest rate management is to minimise the impact of interest rate volatility on interest costs to protect reported profitability. This is achieved by determining a long-term strategy against a number of policy guidelines, which focus on (a) the amount of floating rate indebtedness anticipated over such a period, and (b) the consequent sensitivity of interest costs to interest rate movements on this indebtedness and the resultant impact on reported profitability. The Group uses interest rate caps to manage the Group's exposure to interest rate fluctuations. The impact of a 1% increase in market interest rates would have resulted in an additional interest expense of €9.2 million during the year ended 31 March 2021.

Capital risk management

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders, and benefits to other stakeholders, and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Group may issue new shares or sell assets to reduce debt.

The Group's performance in remaining within its borrowing facilities, including standby overdraft facilities and at the year ends as measured by the headroom available, is as follows:

	2021	2020
	€'000	€'000
Total facilities available	1,078,362	912,186
Facilities drawn down	(1,042,907)	(906,428)
Undrawn facilities at end of year	35,455	5,758
Cash and cash equivalents	139,730	110,962
Total undrawn facilities and cash available at end of year	175,185	116,720

The Group's banking facility specifies that net leverage (12 months EBITDA to net debt for the year ended 31 March 2021) must not exceed 9.60:1. The Board is satisfied that the Group satisfies this requirement.

Financial instruments by category	Derivatives used for hedging	At amortised cost	Total
	€'000	€'000	€'000
31 March 2021
Assets as per balance sheet
Derivative financial instruments	1,598	-	1,598
Trade and other receivables	-	336,145	336,145
Cash and cash equivalents	-	139,730	139,730
Total	1,598	475,875	477,473
Liabilities as per balance sheet
Derivative financial instruments	1,663	-	1,663
Trade and other payables	-	220,631	220,631
Borrowings	-	1,018,088	1,018,088
Total	1,663	1,238,719	1,240,382
31 March 2020
Assets as per balance sheet
Derivative financial instruments	1,582	-	1,582
Trade and other receivables	-	314,331	314,331
Cash and cash equivalents	-	110,962	110,962
Total	1,582	425,293	426,875
Liabilities as per balance sheet
Derivative financial instruments	1,683	-	1,683
Trade and other payables	-	204,728	204,728
Borrowings	-	898,017	898,017
Total	1,683	1,102,745	1,104,428

All derivatives held for hedging purposes are measured at Level 2.

Financial instruments in Level 2 and 3

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Specific valuation techniques used to value financial instruments include:

•	The fair value of forward foreign exchange and oil contracts are determined using forward exchange and oil rates at the balance sheet date, with the resulting value discounted to present value.
•	Quoted market prices or dealer quotes for similar instruments.

Level 3 financial instruments constitute certain potential adjustments to acquisition consideration, which if payable will be comprised of a combination of defined amounts and derivatives of future earnings.

26 Commitments, contingencies and guarantees

(a) Capital expenditure commitments	2021	2020
	€'000	€'000
Contracted but not provided for	4,640	1,360
Authorised by the directors but not yet contracted	3,125	2,646
	7,765	4,006

b) Foreign currency commitments

The Group was committed at 31 March 2021 to various foreign currency contracts, the more significant of which may be summarised as follows:

	2021	2020
	LC'000	LC'000
Euro to Sterling	32,225	24,700
Weighted average rate	0.90	0.85355
Euro to US Dollar	-	2,640
Weighted average rate	-	1.1457
Sterling to Canadian Dollars	3,489	3,590
Weighted average rate	1.758	1.752
Sterling to Euro	14,931	13,183
Weighted average rate	1.138	1.1633
Sterling to New Zealand Dollar	3,720	7,726
Weighted average rate	1.947	2.030
Sterling to US Dollar	37,104	21,867
Weighted average rate	1.353	1.309
Czech to US Dollar	204	2,700
Weighted average rate	22.3	22.996
Czech to Polish Zloty	6,138	20,700
Weighted average rate	6.0	5.995

(c) Other commitments

At 31 March 2021 the Group was committed to forward purchase contracts and other purchase commitments for goods and materials to a total value of €227.4 million (2020: €56.8 million).

(d) Guarantees

The Company is a participant in a Group banking arrangement under which all surplus cash balances are held as collateral for bank facilities advanced to Group members. In addition, the Company has issued an unlimited guarantee to the banking group to support these facilities. Total Group borrowings under these facilities amounted to €1,023.5 million at 31 March 2021 (2020: €906.1 million).

The fair value of this guarantee is considered to be €Nil (2020: €Nil) as it is considered unlikely that the guarantee will be exercised.

(e) Parent Company Guarantee

Each of the following Irish registered subsidiaries of the Company may avail of the exemption from filing its statutory financial statements for the year ended 31 March 2021 as permitted by Section 357 of the Companies Act 2014 and, if any of these Irish registered subsidiaries of the Company elects to avail of this exemption, there will be in force an irrevocable guarantee from the Company in respect of all commitments entered into by such wholly-owned subsidiary, including amounts shown as liabilities (within the meaning of Section 357(1) (b) of the Companies Act 2014) in such wholly owned subsidiary statutory financial statements for the year ended 31 March 2021:

Name of subsidiary

Valeo F1 Company Limited

Valeo F2 Company Limited

Valeo F3 Company Limited

Valeo F4 Company Limited

Maiden Foods Unlimited Company

Batchelors Unlimited Company

Beck Smith & Associates Unlimited Company

Erin Foods Unlimited Company

Fruit Juices Limited

Green Valley Foods Limited

Maiden Property Holdings Unlimited Company

Bachelor Beverage Systems Limited

The Naked Bean Company Limited

Maiden Acquisition Company Unlimited Company

Maiden Acquisition Company Holdings Unlimited Company

Valeo Foods (Ireland) Unlimited Company

Buganda Unlimited Company

Bolands Mills Unlimited Company

Odlum Group Unlimited Company

Jacob Fruitfield Food Group Unlimited Company

W&R Jacob Unlimited Company

Jacob Fruitfield Foods Unlimited Company

Irish Biscuits Unlimited Company

Irish Biscuits Sales Unlimited Company

Wardell Roberts Limited

Robert Roberts Limited

Woodford Bourne Limited

Shield Health Limited

Vinitrading Limited

Oatfield Confectionery Limited

27 Related party transactions

The principal related party relationships requiring disclosure under IAS 24 Related Party Disclosures pertain to the existence of subsidiaries and transactions with these entities and compensation of key management personnel.

Subsidiaries

A listing of the principal subsidiaries is provided in note 29. Sales to and purchases from, together with outstanding payables and receivables to and from, subsidiaries are eliminated in the preparation of the Group financial statements in accordance with IAS 27 Consolidated and Separate Financial Statements.

The Company did not make any sales to or purchases from any Group entities during the year.

For the purposes of the disclosure requirement of IAS 24, the Group has defined the term "key management personnel", as its directors and executive officers. In addition to their salaries, the Group also provides non-cash benefits to directors and executive officers and contributes to post-employment plans for certain directors and executive officers. These directors and executive officers also hold shares in Valeo Foods Group Limited.

	2021	2020
	€'000	€'000
Compensation of key management personnel
Salaries and other short-term employee benefits	1,032	1,052
Termination costs	-	226
Post-employment benefits	55	49
	1,087	1,327
Transactions with shareholders	2021	2020
	€'000	€'000
CapVest
Monitoring fee (charged to operating expenses)	1,072	1,583
Sellers of Jacob Fruitfield Foods
Monitoring fee (charged to operating expenses)	175	175

There are no amounts outstanding at 31 March 2021 or at 31 March 2020 in respect of the related party transactions above.

28 Acquisition of undertakings

Year ended 31 March 2021

In December 2020 and February 2021, the Group acquired It's All Good ("IAG") and the Schluckwerder group of companies, respectively.

The provisional fair values of assets and liabilities acquired are as follows:

	It's All Good	Schluckwerder group	Total
	€'000	€'000	€'000
Non-current assets
Property, plant and equipment - owned use	8,870	31,106	39,976
Property, plant and equipment - right of use	6,867	1,477	8,344
Intangible assets	8,750	16,569	25,319
Financial assets	-	1,305	1,305
Deferred tax - within net assets acquired	-	99	99
Current assets
Inventories	3,900	12,798	16,698
Trade and other receivables	7,611	21,827	29,438
Non-current liabilities
Post-employment benefit obligations	-	(2,166)	(2,166)
Deferred tax - acquisition related	(1,510)	(10,467)	(11,977)
Deferred tax - within net assets acquired	(195)	-	(195)
Lease liabilities	(6,024)	(1,119)	(7,143)
Current liabilities
Borrowings - bank	(4,455)	(6,000)	(10,455)
Borrowings - other	(3,874)	-	(3,874)
Trade and other payables	(5,552)	(10,638)	(16,190)
Corporation tax	-	(3,268)	(3,268)
Deferred tax - acquisition related	(152)	(326)	(478)
Lease liabilities	(843)	(358)	(1,201)
Total identifiable assets	13,393	50,839	64,232
Goodwill	15,975	21,759	37,734
Total consideration paid in cash (net of cash acquired)	29,368	72,598	101,966

Goodwill

The acquired goodwill is attributable principally to the profit generating potential of the businesses, their existing workforces, together with cross selling opportunities expected to be achieved from integrating the acquired businesses into the Group's existing business.

In the post-acquisition period to 31 March 2021, the acquired businesses contributed revenue of €18.9 million and loss after tax of €4.1 million to the Group's results.

The full year revenue and profit after tax, had the acquisitions taken place at the start of the financial year, would have been €166.1 million and €1.3 million, respectively.

The fair value of trade and other receivables (net of aggregate impairment provisions) at the respective dates of acquisition amounted to €29.4 million, all of which is considered recoverable.

The Group incurred acquisition related costs in respect of It's All Good and the Schluckwerder group of companies of €2.9 million (2020: €4.6 million) relating to external legal fees and due diligence costs. These costs have been included in exceptional operating costs in the consolidated income statement.

Year ended 31 March 2020

On 11 October 2019, the Group acquired Kettle Foods Limited and its sister company Yellow Chips BV.

On 26 October 2019, the Group acquired Bakery Foods Limited (trading as Matthew Walker).

Fair value adjustments

The Board completed a post-acquisition fair value assessment of the acquired assets and liabilities of the acquisitions completed during the year ended 31 March 2020 and adjusted the acquired net assets and deferred tax on intangible assets by the following amounts (which also represents a net decrease in the related goodwill):

	Total
	€'000
Increase in acquired net assets through reduction of accruals	810
Increase in deferred tax liability on intangible assets	(413)
Net decrease in goodwill	397

29 Subsidiary companies

The Company owns (directly or indirectly) 100% of the share capital of each of the following entities:

Name of subsidiary	Activity	Registered office
Valeo Holdings Unlimited	Holding company	(2)
Valeo Trustee Company Limited	Holding company	(1)
Valeo Foods (Group) UK LLP	Investment holding company	(3)
Valeo Foods UK Limited	Holding company	(3)
Valeo F1 Company Limited	Trading company	(1)
Valeo F2 Company Limited	Trading company	(1)
Valeo F3 Company Limited	Trading company	(1)
Valeo F4 Company Limited	Intermediate holding company	/ (1)
Valeo Foods Italian BidCo S.p.A	Holding company	(4)
Valeo Foods Luxco S.A.R.L	Trading company	(6)
Maiden Foods Unlimited Company	Holding company	(1)
Batchelors Unlimited Company	Manufacturing	(1)
Beck, Smith and Associates Unlimited Company	Goods for resale	(1)
Erin Foods Unlimited Company	Manufacturing	(1)
Fruit Juices Limited	Dormant	(1)
Green Valley Foods Unlimited Company	Dormant	(1)
Maiden Property Holdings Unlimited Company	Holding company	(1)
Batchelors Beverage Systems Limited	Dormant	(1)
The Naked Bean Company Limited	Dormant	(1)
MacJ One Limited	Holding company	(2)
MacJ Two Unlimited	Holding company	(2)
Maiden Acquisition Company Unlimited Company	Holding company	(1)
Maiden Acquisition Company Holdings Unlimited Company	Holding company	(1)
Valeo Foods (Ireland) Unlimited Company	Goods for resale	(1)
Buganda Unlimited Company	Holding company	(1)
Boland Mills Unlimited Company	Holding company	(1)
Odlum Group Unlimited Company	Manufacturing	(1)
Jacob Fruitfield Food Group Unlimited Company	Holding company	(1)
W&R Jacob Unlimited Company	Holding company	(1)
Jacob Fruitfield Foods Unlimited Company	Dormant	(1)
Irish Biscuits Unlimited Company	Goods for resale	(1)
Irish Biscuits Sales Unlimited Company	Dormant	(1)
Oatfield Confectionery Limited	Dormant	(1)
Rowse Honey Limited	Manufacturing	(3)
London Food Traders Limited	Dormant	(3)
Rowse EBT Limited	Dormant	(3)
Balconi S.p.A	Trading	(4)
Wardell Roberts Limited	Holding company	(1)
Robert Roberts Limited	Dormant	(1)
WR and Kelkin Pension Trustees Designated Activity Company	Corporate Trustee company	(1)
Kelkin Limited	Goods for resale	(1)
Woodford Bourne Limited	Dormant	(1)
Shield Health Limited	Goods for resale	(1)
Pemberton and Seymour Limited	Goods for resale	(1)
Vinitrading Limited	Dormant	(1)
Robert Roberts (NI) Limited	Goods for resale	(7)
Dolciaria Val d'Enza S.p.A	Goods for resale	(8)
PEPPY CZ BIDCO a.s.	Holding Company	(9)
Candy Plus,a.s.	Goods for resale	(10)
The Candy Plus Sweet Factory,s.r.o	Goods for resale	(11)
Candy Plus Polska Sp.z.o.o	Goods for resale	(12)
Big Bear Confectionery Limited	Trading Company	(13)
Fox's Confectionery Limited	Dormant Company	(13)
Taurus 3 Limited	Holding Company	(15)
Taurus Bidco Limited	Holding Company	(15)
Tangerine Confectionery Group Limited	Holding Company	(15)
Tangerine Confectionery Holding Limited	Holding Company	(15)
Tangerine Confectionery Limited	Trading Company	(15)
Portfolio Foods Limited	Dormant Company	(15)
Taverners plc	Dormant Company	(15)
Daintee Properties Limited	Dormant Company	(15)
Toffee De Beurre Limited	Dormant Company	(15)
Harlow's Mintoes (1995) Limited	Dormant Company	(15)
Daintee Chocolate Confectionery Company (Blackpool) Limited	Dormant Company	(15)
Sweet Dealers Limited	Dormant Company	(15)
Parrs Quality Confectionery Limited	Dormant Company	(15)
Motto Marketing Company Limited	Dormant Company	(15)
Rochwood Limited	Holding Company	(15)
Rochgrove Limited	Holding Company	(15)
Kettle Foods Limited	Trading Company	(16)
Kettle Grower Services Limited	Trading Company	(16)
Yellow Chips BV	Trading Company	(17)
Yellow Chip Holdings BV	Trading Company	(17)
Lani BVBA	Trading Company	(18)
DFKA Intermediate Limited	Holding Company	(16)
DFKA UK Holdings Limited	Holding Company	(16)
Diamond Foods International Holding BV	Holding Company	(19)
Valeo Foods B.V.	Holding Company	(20)
Bakery Foods Limited	Trading Company	(3)
Valeo Foods Malta 1 Limited	Investment Company	(21)
Valeo Foods Malta 2 Limited	Investment Company	(21)
Valeo Foods Malta 3 Limited	Investment Company	(21)
It's All Good Limited	Trading Company	(22)
Valeo Foods Germany Bidco GmbH	Holding Company	(23)
Schluckwerder Holding GmbH	Holding Company	(24)
Schluckwerder GmbH	Trading Company	(24)
Schluckwerder Grundstucksgesellschaft GmbH	Property holding company	(24)
Erasmi & Carstens GmbH	Trading Company	(24)

The Registered offices of the above noted subsidiary companies are as follows:

(1)	Commercial House, Millbank Business Park, Lucan, Co Dublin
(2)	Elian, 44 The Esplanade, St Helier, Jersey
(3)	Great St. Helen's, London, England, EC3A 6AP
(4)	Via settembre n.51, CAP20010 Nerviano, Milan
(5)	Via Michellorie n.1, CAP37041 Michellorie, Verona
(6)	Aztec Financial Services (Luxembourg) SA. 7 Rue Lou Hemmer, L-1748 Luxembourg
(7)	138 University Street, Belfast, BT7 1HJ
(8)	Via del Conchello, 43-42026 Ciano d'Enza, Canossa (RE) - Italy
(9)	V celnici 1031/4, Nove Mesto,1110 00 Prague 1, Czech Republic
(10)	Vinohradska 343/6, 120 00 Prague2, Czech Republic
(11)	Vitezna 200/6m696 01 Rohatec, Czech Republic
(12)	Ui. Sudencka 51, 58-500 Jelenia Gora, Poland
(13)	35 Great St. Helen's, London, England, EC3A 6AP, United Kingdom
(14)	Sunningdale Road, Braunstone, Leicester, LE3 1UE, United Kingdom
(15)	Quality House, Vicarage Lane, Blackpool, FY4 4NQ, United Kingdom
(16)	38 Barnard Road, Bowthorpe Employment Area, Norwich, Norfolk, NR5 9JP, United Kingdom
(17)	Fabrieksweg 6, 8304AT, Emmeloord, The Netherlands
(18)	Kasteelhoekstraat 1, 1820 Steenokkerzeel, Belgium
(19)	Herengracht 500, 1017 CB Amsterdam, The Netherlands
(20)	C/O Spaces Zuidas, Barbara Strozzilaan 201, Amsterdam 1083 HN, The Netherlands
(21)	9, Suite 33, Triq Pope Urbanus VIII, Birkirkara BKR 1425, Malta
(22)	272 Dukesway, Team Valley Trading Estate, Gateshead, Tyne and Wear, NE11 0PZ, United Kingdom
(23)	Theresienhohe 30, 80339 Munich, Germany
(24)	Bultenweg 19, 21365 Adendorf, Germany

30 Subsequent events

On 10 May 2021, funds managed by Valeo's majority financial shareholder, CapVest Partners LLP, agreed on the sale of the Group to Bain Capital Private Equity, a leading global private investment firm, for undisclosed consideration. This sale is not expected to result in any significant changes to the day-to-day management of the Group or in the execution of the Group's strategy.

There are no other significant post balance sheet events that would require disclosure in the financial statements.

31 Approval of financial statements

These financial statements were approved by the board on 27 August 2021.

Company balance sheet as at 31 March 2021

	Note	2021	2020
		€'000	€'000
Fixed assets
Tangible assets	2	981	1,116
Intangible assets	3	269	277
Financial assets	4	945,232	905,020
		946,482	906,413
Current assets
Trade and other receivables	5	89,878	106,107
Deferred tax assets	7	-	71
Cash and cash equivalents		2,268	910
Current assets		92,146	107,088
Total assets		1,038,628	1,013,501

	Note	2021	2020
		€'000	€'000
Equity and liabilities
Equity attributable to equity owners of the Parent
Called up share capital	9	80,824	80,824
Share premium	9	20,261	20,261
Profit and loss account		(86,877)	(35,879)
Total equity		14,208	65,206
Liabilities
Lease liabilities	8	554	586
Non-current liabilities		554	586
Trade and other payables	6	1,023,709	947,584
Corporation tax		38	-
Deferred tax liability	7	15	-
Lease liabilities	8	104	125
Current liabilities		1,023,866	947,709
Total liabilities		1,024,420	948,295
Total equity and liabilities		1,038,628	1,013,501

On behalf of the board

27 August 2021

S Kearney, Director

B Feeney, Director

Company statement of changes in equity for the year ended 31 March 2021

	Called up share capital	Share premium	Profit and loss account	Total equity
	€'000	€'000	€'000	€'000
At 1 April 2019	80,824	20,261	(111,026)	(9,941)
Profit for the year	-	-	75,147	75,147
Other comprehensive income/ (expense)	-	-	-	-
Total comprehensive income for the year	-	-	75,147	75,147
At 31 March 2020	80,824	20,261	(35,879)	65,206
Loss for the year	-	-	(50,998)	(50,998)
Other comprehensive income/ (expense)	-	-	-	-
Total comprehensive (expense) for the year	-	-	(50,998)	(50,998)
At 31 March 2021	80,824	20,261	(86,877)	14,208

Company statement of cash flows for the year ended 31 March 2021

	2021	2020
	€'000	€'000
Cash flows from operating activities
(Loss)/profit after tax	(50,998)	75,147
Adjust for:
Depreciation of tangible assets	177	161
Amortisation of intangible assets	87	76
Finance costs (net)	54,011	43,013
Tax expense/(income)	86	(893)
Decrease in trade and other receivables	16,229	62,279
Increase in trade and other payables	76,163	16,497
	95,755	196,280
Interest paid and related costs	(54,011)	(43,013)
Net cash flows from operating activities	41,744	153,267
Cash flows from investing activities
Investment in subsidiary companies	(40,212)	(152,274)
Purchase of tangible assets	-	(1)
Purchase of intangible assets	(79)	(142)
Net cash flows from investing activities	(40,291)	(152,417)
Cash flows from financing activities
Payments in respect of leases	(95)	(125)
Net cash flows from financing activities	(95)	(125)
Net increase in cash and cash equivalents	1,358	725
Cash and cash equivalents at the beginning of year	910	185
Cash and cash equivalents at end of year	2,268	910

Notes

forming part of the Company financial statements

1 Accounting policies

The individual financial statements of the Company ("Company financial statements") have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework ("FRS 101") and as applied in accordance with the Companies Act 2014 which permits a company that publishes its Company and Group financial statements together, to take advantage of the exemption in Section 304 of the Companies Act 2014 from presenting to its members its company income statement and related notes that form part of the approved Company financial statements.

There have been no material departures from the standards.

In preparing these financial statements, the Company applies the recognition, measurement and disclosure requirements of International Financial Reporting Standards as adopted by the EU ("Adopted IFRSs"), but makes amendments where necessary in order to comply with the Companies Act 2014.

The Company's ultimate controlling party and parent undertaking of the largest group of undertakings of which the Company is a member and for which group financial statements are prepared is Valeo Foods Group Limited, a Company incorporated in Jersey. The smallest group in which they are consolidated is that headed by Valeo Foods incorporated in the Republic of Ireland.

The significant accounting policies used in the preparation of the entity financial statements are set out below. These policies have been consistently applied to all financial years presented, unless otherwise stated.

Accounting convention

The financial statements are prepared under the historical cost convention.

Financial assets

Investments in subsidiary undertakings are stated at cost less provisions for impairment.

Foreign currencies

Transactions denominated in foreign currencies have been translated to Euro at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated to Euro at the rates of exchange ruling at the balance sheet date or, where appropriate, at the rates of exchange in related forward contracts. The resulting profits or losses are dealt with in the profit and loss account.

Taxation

Corporation tax is provided on taxable profits at the current rate.

Leases

Refer to the accounting policies set out in the consolidated financial statements in respect of IFRS 16 Leases, which the Company applies under FRS 101.

2 Tangible assets	Land and buildings	Plant and equipment	Total
	€'000	€'000	€'000
Cost
At 31 March 2020	791	590	1,381
Additions - right of use asset (note 8)	42	-	42
At 31 March 2021	833	590	1,423
Accumulated depreciation
At 31 March 2020	102	163	265
Charge for the year	-	64	64
Charge for the year - right of use asset	113	-	113
(note 8)
At 31 March 2021	215	227	442
Net book amount
At 31 March 2021	618	363	981
At 31 March 2020	689	427	1,116

3 Intangible assets	Computer software
	€'000
Cost
At 31 March 2020	406
Additions	79
At 31 March 2021	485
Accumulated depreciation
At 31 March 2020	129
Charge for the year	87
At 31 March 2021	216
Net book amount
At 31 March 2021	269
At 31 March 2020	277

4 Financial assets	2021	2020
	€'000	€'000
Company
Investments in subsidiary undertakings, at cost	945,232	905,020

In the opinion of the directors, the investments in subsidiary undertakings are worth at least the amount at which they are stated in the balance sheet.

The movement from 31 March 2020 to 31 March 2021 represents additions to investments in subsidiary undertakings.

See note 29 in the consolidated financial statements for a listing of subsidiary companies.

5 Trade and other receivables	2021	2020
	€'000	€'000
Current
Amounts due by group companies	89,867	106,013
VAT	-	94
Other receivables	11	-
	89,878	106,107

Amounts due by group companies are interest free and receivable on demand.

6 Trade and other payables	2021	2020
	€'000	€'000
Current
Amounts due to group companies	1,016,271	943,631
Accrued expenses	7,438	3,953
	1,023,709	947,584

Amounts due to group companies carry interest rates ranging from 0% to 8% and are payable on demand.

7 Deferred tax	2021	2020
	€'000	€'000
Deferred tax (liabilities)/assets	(15)	71

8 Leases

In respect of the year ended 31 March 2021

Right of use assets	Land and buildings
	€'000
Cost
At 31 March 2020	791
Additions	42
At 31 March 2021	833
Accumulated depreciation
At 31 March 2020	102
Charge for the year	113
At 31 March 2021	215
Net book amount
At 31 March 2021	618
At 31 March 2020	689

Lease liabilities	€'000
Balance as at 31 March 2020	711
Additions	42
Lease payments	(126)
Lease interest	31
Balance at 31 March 2021	658

The maturity of lease liabilities is as follows:	€'000
Less than 1 year	104
Between 1 and 5 years	554
Balance at 31 March 2021	658

Right of use assets	Land and buildings
	€'000
Cost
At 1 April 2019	791
Charge for the year	(102)
At 31 March 2020	689
Lease liabilities
	€'000
Balance as at 1 April 2019	791
Lease payments	(125)
Lease interest	45
Balance at 31 March 2020	711

The maturity of lease liabilities is as follows:

	€'000
Less than 1 year	125
Between 1 and 5 years	500
Over 5 years	86
Balance at 31 March 2020	711

9 Share capital/share premium

See note 24 to the consolidated financial statements.

10 Approval of financial statements

These financial statements were approved by the board on 27 August 2021.