1. BASIS OF PREPARATION

These interim financial statements, which are unaudited, comply with relevant accounting standards and should be read in conjunction with the Annual Report and Accounts for the year to 31 August 1999. With the following two exceptions, the accounting policies have been applied on a basis consistent with those applied in 1999, which are prepared in accordance with accounting principles generally accepted in the United Kingdom (UK GAAP):

(i) FRS 15 (Tangible fixed assets) has been adopted, with no prior period adjustment as the UK Retail assets have been disposed.

(ii) FRS 16 (Current tax) has been adopted, with no effect on either the period being reported or the prior period.

The periods to 29 February 2000 and 28 February 1999 are regarded as distinct financial periods for accounting purposes with the exception of taxation where the periods are allocated an appropriate proportion of the expected total annual charge.

The figures for the year to 31 August 1999 are an abridged version of the group's published financial statements which have been reported on by the group's auditor and filed with the Registrar of Companies.

The report of the auditor was unqualified and did not contain a statement under section 237 (2) or (3) of the Companies Act 1985.

These interim financial statements were approved by the Board on 3 May 2000.

2. PROFORMA PROFIT AND LOSS ACCOUNT

1998/99			1999/00	1998/99
12 months			6 months	6 months
£m			£m	£m
2,408		Turnover	1,284	1,238
369		Spirits & Wine	225	207
53		QSR	19	12
21		Britannia and Panrico	8	6
443		Trading Profit	252	225
-81		Finance charges	-42	-44
362		Profit on ordinary activities before taxation	210	181
-94		Taxation	-55	-47
-5		Minority interests and preference dividends	-2	-2
263		Profit earned for ordinary shareholders for the year	153	132
25.1		Proforma normalised earnings per ordinary share (pence)	14.4	12.6

3. ACTIVITY ANALYSIS

1998/99					1999/00	1998/99
12 months					6 months	6 months
£m		Turnover			£m	£m
2,110		Spirits & Wine			1,157	1,115
298		QSR			127	123
2,408		Ongoing operations			1,284	1,238
130		Discontinued operations	- Cantrell & Cochrane		0	130
			- UK Retail
1,565				(including share of joint venture)	18	782
4,103					1,302	2,150
		Trading Profit (before exceptional items)
369		Spirits & Wine			225	207
53		QSR			19	12
422		Ongoing operations			244	219
8		Britannia Soft Drinks			2	0
					]
13		Panrico (discontinued after 29 February 2000)			6	6
24		Discontinued operations	- Cantrell & Cochrane		0	24
204			- UK Retail		4	98
671					256	347

4. GEOGRAPHICAL ANALYSIS

1998/99						1999/00			1998/99
12 months						6 months			6 months
Turnover		Trading profit *				Turnover	Trading profit *		Turnover	Trading profit *
£m		£m		By country of destination		£m	£m		£m	£m
273		63		United Kingdom		158	27		165	30
730		120		Rest of Europe		372	70		381	70
824		158		USA		406	88		379	77
83		19		Canada		39	12		38	10
285		31		Mexico		201	28		170	20
213		31		Rest of World		108	19		105	12
2,408		422		Ongoing operations		1,284	244		1,238	219
0		8		Britannia Soft Drinks		0	2		0	0
0		13		Panrico (discontinued after 29 February 2000)		0	6		0	6
130		24		Discontinued operations	- Cantrell & Cochrane	0	0		130	24
1,565		204			- UK Retail	18	4		782	98
4,103		671				1,302	256		2,150	347
				By country of operation
612		101		United Kingdom		346	63		343	60
853		102		Rest of Europe		450	56		452	58
948		141		USA		466	71		441	65
115		29		Canada		60	17		56	14
314		45		Mexico		213	37		183	28
110		4		Rest of World		57	0		54	-6
2,952		422		Ongoing operations		1,592	244		1,529	219
0		8		Britannia Soft Drinks		0	2		0	0
0		13		Panrico (discontinued after 29 February 2000)		0	6		0	6
142		24		Discontinued operations	- Cantrell & Cochrane	0	0		142	24
1,565		204			- UK Retail	18	4		782	98
4,659		671				1,610	256		2,453	347
-556		0		Turnover with group companies		-308	0		-303	0
4,103		671				1,302	256		2,150	347
* Trading profit above is before exceptional items.

5. RECONCILIATION TO PROFORMA NORMALISED EARNINGS

1998/99			1999/00	1998/99
12 months			6 months	6 months
£m			£m	£m
76		Earnings as reported	171	266
		Adjustments for the following:
		Continuing operations - exceptional items
220		Operating costs	6	86
4		Costs in associated undertakings	0	0
272		Finance charges	0	33
		Discontinued operations - UK Retail and Cantrell & Cochrane
-228		Trading profits	-4	-122
15		Operating costs	0	10
14		Costs in joint venture undertaking	0	7
11		Finance charges	0	11
1		Minority interests	0	1
		Continuing and discontinued operations - exceptional items
-179		(Profit)/loss on sale of businesses	0	-176
12		(Profit)/loss on disposal of fixed assets	-19	2
45		Tax on above	-1	14
263		Proforma normalised earnings (see note 2)	153	132
1,047		Average number of ordinary shares in issue (millions)	1,062	1,045
25.1p		Proforma normalised earnings per ordinary share	14.4p	12.6p

6. EXCEPTIONAL ITEMS

1998/99			1999/00	1998/99
12 months			6 months	6 months
£m			£m	£m
-27		Year 2000 and EMU costs	-6	-13
-37		Surplus property provisions	0	-18
-59		Asset write-downs	0	-58
-45		UK Retail disposal costs	0	0
-67		Restructuring and other costs	0	-7
-235		Operating costs	-6	-96
-18		Costs in joint venture and associated undertakings	0	-7
		Profit/(loss) on sale of businesses
189		Disposal of Cantrell & Cochrane	0	189
-10		Other disposals	0	-13
-12		Profit/(loss) on disposal of fixed assets	19	-2
		Finance charges
-35		Premium on redemption of loan stock	0	-33
-237		Premium on redemption of debentures	0	0
-358		Exceptional items before taxation	13	38
11		Taxation	2	15
-347		Exceptional items after taxation	15	53

7. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

1998/99			1999/00	1998/99
12 months			6 months	6 months
£m			£m	£m
76		Profit earned for ordinary and preference shareholders for the period	171	266
4		Currency translation differences on foreign currency net investments	17	5
80		Total recognised gains and losses for the period	188	271
-157		Dividends	-42	-157
112		Ordinary share capital issued (net of costs)	0	6
-9		Preference share redemption	0	-9
0		Capital reduction due to disposal of UK Retail business	-2,294	0
219		Goodwill written back on disposals	0	210
245		Net movement in shareholders' funds	-2,148	321
2,028		At the beginning of the period	2,273	2,028
2,273		At the end of the period	125	2,349