27th Mar 2006 08:59
Diageo PLC27 March 2006 27 March 2006 Diageo agrees funding framework for UK pension fund deficit Diageo has agreed framework funding principles with the Trustees of the UKcompany pension scheme which provide for the company to fund the UK pensionscheme deficit over a 7-year period beginning in the 2007 financial year. For the purposes of the agreement the value of the deficit, which will becalculated using the trustees' actuarial valuation of the scheme, will beascertained through the planned 3-yearly valuation as of 31 March 2006.Following the completion of that valuation later this year, the initial annualcash contribution, which Diageo will make under this funding framework, isestimated to be around £100 million. At 31 December 2005 the deficit in Diageo'sUK company pension schemes including unfunded liabilities and calculated underIAS 19, was £653 million. In addition to the deficit funding, Diageo will continue to make a cashcontribution in respect of annual benefits awarded to active members, which inthe year ending 30 June 2006 is expected to be £50 million. The agreed frameworkprovides for a reassessment of the funding position on a triennial basis andallows for appropriate adjustments in company contributions in line with thedeficit at that time. These arrangements are not expected to lead to a change inDiageo's previously announced share buy back programme. Paul Walsh, Chief Executive of Diageo, commented: 'This funding framework, together with changes we have made to the pensionscheme, demonstrate Diageo's commitment to provide a high standard of employmentbenefits. It follows the sale of our shares in General Mills and our full exitfrom Burger King and provides further clarity in relation to Diageo's balancesheet. ' -ENDS- Contacts: Investor Relations: Catherine James +44 (0)207 927 5272 [email protected] Media Relations: Isabelle Thomas +44(0)207 927 5967 [email protected] Notes to Editor: Diageo is the world's leading premium drinks business. With its global vision,and local marketing focus, Diageo brings to consumers an outstanding collectionof beverage alcohol brands across the spirits, wine and beer categoriesincluding Smirnoff, Guinness, Johnnie Walker, Baileys, J&B, Cuervo, CaptainMorgan and Tanqueray, and Beaulieu Vineyard and Sterling Vineyards wines. Diageotrades in some 180 countries around the world and is listed on both the New YorkStock Exchange (DEO) and the London Stock Exchange (DGE). For more informationabout Diageo, its people, brands and performance, visit us at www.diageo.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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