THE BIG FOOD GROUP
 
Group Profit and Loss Account
For the 52 weeks ended 28 March 2003
 
 52 weeks ended 52 weeks ended
  Before Exceptional 28 March 2003 29 March 2002 
 exceptional items Total Total
  items (note 5)
 Note £m £m £m £m
 
Turnover 1 5,060.9 - 5,060.9 5,220.4
 
Cost of sales (4,890.4) - (4,890.4) (5,039.4)
 ---------------- ---------------- ---------------- ----------------
Gross profit 170.5 - 170.5 181.0
Administrative expenses (130.3) (13.0) (143.3) (137.5)
 
Operating profit before goodwill and
operating exceptional items 1 62.4 - 62.4 76.1
 
Goodwill amortisation (22.2) - (22.2) (22.2)
Operating exceptional items 2 - (13.0) (13.0) (10.4)
 
Operating profit 1 40.2 (13.0) 27.2 43.5
 
Profit on disposal of fixed assets 2 - 17.8 17.8 4.2
 ---------------- ---------------- ---------------- ----------------
Profit on ordinary activities before
interest and taxation 40.2 4.8 45.0 47.7
 
Interest payable (net) 3 (25.3) (5.2) (30.5) (34.9)
  ---------------- ---------------- ---------------- ----------------
Profit on ordinary activities before
taxation 14.9 (0.4) 14.5 12.8
 
 ========= =========
Tax on profit on ordinary activities (2.8)  (3.5)
 ---------------- ----------------
Profit for the period 11.7 9.3
 
Dividends 4 (8.3) (8.4)
 ---------------- ----------------
Retained profit for the period 3.4 0.9
 ========= =========
  Pence Pence
 
Earnings per ordinary share - basic: 5 3.5 2.8
 - adjusted: 5  9.3 11.4
 - diluted: 5 3.5 2.8
 
 
 
All operations in the current and prior period are continuing.
Group Statement of Total Recognised Gains and Losses
 
For the 52 weeks ended 28 March 2003
 52 weeks 52 weeks
  Ended ended
 28 March 2003 29 March 2002
  £m £m
 
Profit for the financial period 11.7 9.3
Exchange movements 0.6 -
  -------------- --------------
Total recognised gains for the period 12.3 9.3
  ======== ========
 
 
Reconciliation of Movement in Shareholders' Funds
For the 52 weeks ended 28 March 2003
 
 
  52 weeks ended 52 weeks ended
 28 March 2003 29 March 2002
 £m  £m
 
 
Total recognised gains and losses 12.3 9.3
Dividends paid and proposed (8.3) (8.4)
New share capital allotted - 1.5
 --------------- ---------------
Net increase in shareholders' funds  4.0 2.4
Shareholders' funds at the beginning of the period 402.5 400.1
  --------------- ---------------
Shareholders' funds at the end of the period 406.5 402.5
 =========  =========
 
 
 
 
Balance Sheets
At 28 March 2003
 
 
 Group Company
 28 March 2003 29 March 2002 28 March 2003 29 March 2002
 
 £m £m £m £m
 
Fixed assets
Intangible assets 383.4 405.6 -  -
Tangible assets 483.8 614.6 - -
Investments 9.1 11.2 9.1 501.0
  -------------- -------------- -------------- --------------
 876.3 1,031.4 9.1 501.0
 -------------- -------------- -------------- --------------
Current assets
Stocks 290.8 296.6 - -
Debtors due within one year 138.9  142.3 621.4 447.9
Short-term deposits 14.6 4.6 - -
Cash at bank and in hand 43.8 36.8 -  -
 -------------- -------------- -------------- --------------
 488.1 480.3 621.4 447.9
 
Creditors due within one year (635.6) (1,049.6) (10.2) (459.3)
 -------------- -------------- -------------- --------------
Net current (liabilities) / assets  (147.5) (569.3) 611.2 (11.4)
 -------------- -------------- -------------- --------------
Total assets less current liabilities 728.8 462.1  620.3 489.6
 
Creditors due after one year (267.2) (9.1) (144.3) (5.3)
 
Provisions for liabilities and charges (55.1) (50.5) - -
  -------------- -------------- -------------- --------------
 406.5 402.5 476.0 484.3
  ======== ======== ======== ========
 
Capital and reserves
Called up share capital 34.3 34.3 34.3 34.3
Share premium account  17.7 17.7 17.7 17.7
Merger reserve 330.4 330.4 330.4 330.4
Profit and loss account 24.1  20.1 93.6 101.9
 -------------- -------------- -------------- --------------
Equity shareholders' funds 406.5 402.5 476.0 484.3
 ======== ======== ======== ========
 
 
Group Cash Flow Statement
For the 52 weeks ended 28 March 2003
 
 
  52 weeks ended 52 weeks ended
 Note 28 March 2003 29 March 2002
 £m  £m
 
Cash flow from operating activities 6 95.7 161.8
Servicing of finance 7 (29.5) (40.3)
Taxation refunded 4.8 8.0
Capital expenditure and financial investment 7 58.9 (27.4)
Equity dividends paid  (8.3) (3.4)
 ----------------- -----------------
Cash inflow before use of liquid resources and financing  121.6 98.7
Management of liquid resources:
 
Net (outflow)/inflow from short-term deposits (10.0) 0.7
 
Financing  7 (143.8) (81.0)
 ----------------- -----------------
(Decrease)/increase in cash for the period (32.2) 18.4
 ========== ==========
 
Reconciliation of net cash flow to movement in net debt:
 
 
(Decrease)/increase in cash for the period  8 (32.2) 18.4
Cash outflow from debt and lease financing 8 143.8 82.5
Cash outflow/(inflow) from liquid resources 8 10.0 (0.7)
 ----------------- -----------------
Movement in net debt in the period 121.6 100.2
 
Net debt at start of period 8 (404.2) (504.4)
 ----------------- -----------------
Net debt at end of period  8 (282.6) (404.2)
 ========== ==========
 
Notes to the Accounts
At 28 March 2003
 
Basis of Preparation and Accounting Policies
 
The preliminary accounts have been prepared on the basis of the accounting
policies set out in the Group's statutory accounts for the period ended 29 March
2002.
 
These statements do not constitute statutory accounts within the meaning of
section 240 of the Companies Act 1985. The accounts for the 52 weeks ended 29
March 2002 have been extracted from the full accounts, which have been filed
with the Registrar of Companies. The accounts for the 52 Weeks ended 28 March
2003 will be filed following the Company's AGM. The Auditors' Report on both
periods' accounts was unqualified and did not contain any statement under
section 237 of the Companies Act 1985.
 
1. Segmental analysis of continuing operations
 
  Turnover Profit before Net assets Turnover Profit before Net assets
 tax tax
 52 weeks 52 weeks 28 March 2003 52 weeks 52 weeks 29 March 2002
 ended ended ended ended
 28 March 28 March 29 March  29 March
 2003 2003 2002 2002
 
 £m £m £m £m £m £m
 
 Wholesale  3,455.4 56.9 81.3 3,544.4 54.6 112.6
 Food service 95.9 (2.6) 24.9 87.0 (1.6) 29.4
 Retail 1,509.6  8.1 244.6 1,589.0 23.1 295.1
 ------------ ------------- ------------- ------------ ------------- -------------
 5,060.9 62.4 350.8  5,220.4 76.1 437.1
 ======= =======
 Goodwill amortisation (22.2) (22.2)
 
 Operating exceptional items
 Wholesale (5.8) (3.8)
 Food service - (0.2)
 Retail  (7.2) (6.4)
 ------------ ------------
 Operating profit 27.2 43.5
 Profit on disposal of fixed
 assets 17.8 4.2
 
 Net interest payable (note (30.5)  (34.9)
 3)
 Other net assets/ 55.7 (34.6)
 (liabilities)
 ------------- -------------  ------------- -------------
 14.5 406.5 12.8 402.5
 ======= ======= =======  =======
 
The goodwill amortisation relates principally to the wholesale business. £20.2m
of the profit on disposal of fixed assets relates to the wholesale business and
the balance to the retail business.
 
All operations are continuing and are carried out in the United Kingdom and the
Republic of Ireland.
 
Other net assets/(liabilities) comprise: Goodwill, investments, corporation and
deferred tax, net borrowings, interest and dividends payable.
 
Notes to the Accounts
At 28 March 2003 (continued)
 
 
2.  Exceptional items 52 weeks ended 52 weeks ended
 28 March 2003 29 March 2002
  £m £m
 
 Integration and strategic review costs 7.1 7.9
 Re-financing costs  - 2.0
 Business closures 2.1 -
 Asset write down 1.1  -
 Onerous lease provision 2.2 -
 Write down of investments - 1.3
 Other  0.5 (0.8)
 ------------ ------------
 Total operating exceptional items  13.0 10.4
 ======= =======
 
 Profit on disposal of fixed assets (17.8) (4.2)
 ======= =======
 
 Integration and strategic review costs are principally related to the 
 creation of a Finance Shared Service Centre and comprise professional 
 fees, together with some reorganisation and redundancy costs and
 related asset write downs.
 
 Business closures include the Sovereign confectionery business and the 
 Home Shopping pick centres.
 
 The write down of assets results from a review of loss making store assets.
 
 The onerous lease provision relates to loss making store lease costs.
 
 The profit on sale of fixed assets relates principally to the sale and 
 leaseback of 31 properties as part of the re-financing programme.
 
3. Interest payable (net) 52 weeks ended 52 weeks ended
  28 March 29 March 2002
 2003
 £m £m
 
 Interest receivable and similar income (2.2) (2.8)
 --------------- ---------------
 Interest payable:
 Interest on bank loans and overdrafts 12.0 33.2
 Loan note interest 11.4 0.2
 Finance charges payable under finance leases  0.9 1.4
 Unwinding of discount on provisions 1.2 0.6
 Other interest payable  2.0 0.6
 --------------- ---------------
 Total interest payable 27.5 36.0
  ---------------- ----------------
 Exceptional costs:
 Bank fees related to the syndicated facility - 1.7
 Interest rate swap closure costs 5.2 -
 --------------- ---------------
  30.5 34.9
 ========= =========
 
Notes to the Accounts
At 28 March 2003 (continued)
 
 
4. Dividends  52 weeks ended 52 weeks ended
 28 March 2003 29 March 2002
  £m £m
 
 Interim dividend on ordinary equity shares 3.3 3.4
 Final dividend on ordinary equity shares  5.0 5.0
 ------------ ------------
  8.3 8.4
 ======= =======
 
5. Earnings per ordinary share
 
 Basic and diluted
 The basic and diluted earnings per share are calculated based on the following data:
 
 
 52 weeks ended 52 weeks ended
  28 March 29 March
 2003 2002
 £m  £m
 
 Profit for the financial period 11.7 9.3
 ======== ========
 
 No. (m) No. (m)
 
 Basic weighted average number of shares 331.6 332.1
 Dilutive potential ordinary shares - employee options 0.5 4.0
 ------------ ------------
 Diluted weighted average number of shares 332.1 336.1
 ======= =======
 
 The basic weighted average excludes shares held in the employee share 
 trust, as required by FRS14. The effect of this is to reduce the average 
 by 11,426,458 (2002: 9,874,861).
 
 
 Adjusted
 Adjusted earnings per share are presented in addition to the basic required by FRS14 since, in the opinion of the
 directors, this represents a clearer year-on-year comparison of the earnings of the Group. The adjusted items are
 the exclusion of goodwill amortisation, exceptional items and associated tax credit.
 
 52 weeks 52 weeks
 ended ended
  28 March 29 March
 2003 2002
  Pence Pence
 
 Base earnings per share 3.5 2.8
 Goodwill amortisation  6.7 6.7
 Exceptional items 0.1 2.4
 Associated tax  (1.0) (0.5)
 ------------- --------------
 Adjusted earnings per share  9.3 11.4
 ======== ========
 
 
 
 
Notes to the Accounts
 
At 28 March 2003 (continued)
 
 
6. Reconciliation of operating profit to operating cash flows 52 weeks 52 weeks
 ended ended
  28 March 29 March
 2003 2002
  £m £m
 
 Operating profit 27.2 43.5
 Operating exceptional items  13.0 10.4
 -------------- ----------------
 Operating profit before operating exceptional items  40.2 53.9
 Depreciation 73.3 79.0
 Amortisation of goodwill  22.2 22.2
 Amortisation of investments 4.5 2.6
 Exceptional costs (5.6) (19.5)
 Decrease in stocks 5.8 63.4
 Decrease/(increase) in debtors 4.4  (10.4)
 Decrease in creditors (44.6) (20.7)
 Cash flow relating to provisions (4.5) (8.7)
  -------------- ----------------
 Net cash inflow from operating activities 95.7 161.8
  ======== =========
 
 
7. Analysis of cash flows 52 weeks 52 weeks
  ended ended
 28 March 29 March
  2003 2002
 £m £m
 Servicing of finance
 Net interest paid  (23.5) (36.7)
 Interest element of finance lease rental payments (0.8) (1.4)
 Interest rate swap closure costs  (5.2) -
 Bank fees related to the syndicated facility - (2.2)
  -------------- ----------------
 Net cash outflow for servicing of finance (29.5) (40.3)
  ======== =========
 
 
 Capital expenditure and financial investment
 
 Purchase of tangible fixed assets (68.7) (45.8)
 Sale of tangible fixed assets 130.0 18.4
 Purchase of shares for ESOP (2.4) -
  -------------- ----------------
 Net cash inflow/(outflow) for capital expenditure and financial investment 58.9 (27.4)
  ======== =========
 
 Financing
 Issue of share capital - 1.5
 Proceeds from new borrowings  260.4 -
 Repayment of borrowings (396.4) (69.7)
 Capital element of finance lease repayments  (7.8) (12.8)
 -------------- ----------------
 Net cash outflow from financing (143.8) (81.0)
 ======== =========
 
Notes to the Accounts
At 28 March 2003 (continued)
 
 
8. Analysis of net debt  At 29 March At 28 March
 2002 Cash flow 2003
 £m  £m £m
 
 Cash at bank and in hand 36.8 7.0 43.8
 Overdrafts (2.0) (39.2) (41.2)
  --------------- -------------- ---------------
 34.8 (32.2) 2.6
 Debt due within one year  (427.0) 400.4 (26.6)
 Debt due after one year (2.1) (264.4) (266.5)
 Finance leases (14.5)  7.8 (6.7)
 --------------- -------------- ---------------
 (408.8) 111.6 (297.2)
 
  Liquid resources - short-term deposits 4.6 10.0 14.6
 --------------- -------------- ---------------
  (404.2) 121.6 (282.6)
 ======== ======== ========
 
 
9. Pensions
 
 FRS 17 Disclosures for the year to 28 March 2003
 
 The Group has continued to account for pensions in accordance with 
 SSAP 24. However, FRS17 ' Retirement Benefits' requires the following 
 transitional disclosures:
 
 Independent qualified actuaries have updated the results of the most 
 recent actuarial valuations for the defined benefit scheme from 
 30 June 2001 to 28 March 2003.
 
 The main financial assumptions used in the valuation of the liabilities of the company's pension
 schemes under FRS 17 are:
 28 March 2003 29 March 2002
 Discount rate 5.30%  5.80%
 Rate of increase in salaries 4.00% 4.00%
 Pension increases 2.50% 2.50%
  Inflation 2.50% 2.50%
 
 The assets in the schemes and the expected rates of return were:
 
 Long term rate  Long term rate
 of return of return
 expected at 28 expected at 29
  March 2003 March 2002
 £m £m
 Equity 6.00% 230.9  6.75% 364.4
 Bonds 5.70% 182.3 5.50% 147.4
 Other 3.75% 10.6 4.75% 12.7
  -------------- -------------
 Total market value of assets 423.8 524.5
  ======== =======
 
 
 
Notes to the Accounts
 
At 28 March 2003 (continued)
 
 
9. Pensions (continued) At 28 March 2003 At 29 March 2002
  £m £m
 
 The following amounts were measured in
 
 accordance with the requirements of FRS17:
 Total market value of assets 423.8 524.5
 Present value of scheme liabilities (644.3) (560.4)
 ----------- -----------
 Deficit in the scheme (220.5) (35.9)
 Related deferred tax asset 66.2 10.8
  ----------- -----------
 Net pension liability (154.3) (25.1)
  ====== ======
 
 
 The effect on the balance sheet and profit and loss account if FRS 17 had been
 implemented during the period are shown below.
 
 Net assets and reserves
  At 28 March
 2003
 
  £m
 Net assets excluding net pension liability under SSAP 24 410.8
 Net pension liability  (154.3)
 ------------
 Net assets including net pension liability under FRS 17 256.5
  =======
 Profit and loss reserve excluding net pension liability under SSAP 24 28.4
 Net pension liability  (154.3)
 ------------
 Profit and loss account including net pension reserve under FRS 17  (125.9)
 =======
 
 
 Profit and loss account
  52 weeks
 ended
 28 March 2003
  £m
 
 Amounts charged to operating profit
 
 Current service cost - defined benefit scheme 4.8
 
  =======
 
 Amounts (credited) / charged to net interest payable
 Expected return on pensions schemes' assets  (32.9)
 Interest on pensions schemes' liabilities 32.1
 ------------
  (0.8)
 =======
 
 
Notes to the Accounts
At 28 March 2003 (continued)
 52 weeks
 ended
  28 March
 2003
  £m
 Amounts to be recorded in the Statement of Total Recognised Gains and Losses
 Difference between actual and expected return on assets (121.2)
 Experience gains / (losses) on liabilities -
 Change in actuarial assumptions (68.7)
  ------------
 Actuarial loss (189.9)
  =======
 
 Movements in deficit during the year
 Deficit in the scheme at start of year (36.0)
 Total operating charge  (4.8)
 Employer contributions 9.4
 Total financing income  0.8
 Actuarial loss (189.9)
  ------------
 Deficit in the scheme at end of year (220.5)
 =======