Simon Litherland - CEO Mathew Dunn - CFO

Chris Pitcher - Redburn Richie Felton - Morgan Stanley Andrea Pistacchi - Deutsche Bank Patrick Higgins - Goodbody Laurence Whyatt - SocGen Carl Walton - UBS Damian McNeela - Numis Komal Dhillon - JP Morgan Andrew Holland - SocGen

Good morning and welcome, everybody. Today, I’m going to talk about how we have delivered our commitments in F ‘17. Mat will then come up and update on our financial performance. And I’ll come back and close by reflecting on our strategic delivery to date and sharing some of the highlights that will be coming up in F ‘18. So 2017 has been another strong year for Britvic, demonstrating once again that we can deliver in the short term while continuing to invest in long-term growth. Highlights include strong revenue and profit growth; successfully innovating into a rapidly changing category; continued organic margin growth through combining price realization with a continued focus on cost reduction; completing and integrating two acquisitions during the year, one in Brazil and one in Ireland; progressing our investment in the GB supply chain and our wider business capability program; and continuing to internationalize the business, with 41% of revenue now generated outside of GB. Despite the headwinds facing all FMCG businesses, we have delivered revenue growth across our core markets in ‘17. In GB, growth came from successful revenue management and the carbonates brands. We led promotional price movement in the market. Pepsi grew both revenue and market share, thanks to Max. And the re-launch of R Whites drove double-digit growth. Whilst GB stills have improved, there is still more work to be done, but I’m confident we have strong plans that I will share with you later. In France, we also successfully executed a revenue management plan this year despite continued pressure from grocery buying groups. Our investment in the brand portfolio has continued to pay off, with brands now accounting for over 60% of revenue compared to 50% at the time of acquisition. I’m particularly pleased with the growth in our juice brand Pressade, which grew 32% this year, making it the third largest contributor to soft drinks revenue growth in France in 2017. Finally, in Ireland, we also grew revenue despite a highly competitive pricing environment, particularly in carbonates. Our portfolio of leading low and no sugar brands has continued to resonate with Irish consumers seeking healthier choices. In the on trade, our Counterpoint wholesaling business has delivered further growth both expanding distribution of our soft drinks range and also increasing our share of alcohol and snacks that accompany it. In addition, it has benefited from the East Coast acquisition, which has significantly improved our route to market in Dublin. Innovation was identified in our strategy as a key long term growth driver for the business. We have, therefore, over the last three years, increased investment in our innovation capability in areas such as insight, liquid development and packaging technology. The benefits of this are now coming to fruition. We are successfully launching new products that meet the growing consumer trend of healthier and more premium drinks. We often utilize the strength of our core brands to innovate from. For example, we launched Robinsons Squash’d to make it easier for people to drink squash when out of their homes. And last year, we launched Robinsons Refresh’d to enable the enjoyment of a natural low calorie, ready to drink Robinsons while on the go. We also continue to target our brands towards new sources of growth, such as the growing energy market with our natural energy drink Purdey’s. Finally, we target all of our innovation to be long-term margin accretive, and the vast majority will be below the sugar levy. Compared to 2010, when owned-brand innovation accounted for 1.5% of total revenue, we are now generating 5.4%. We hold ourselves to a strict definition of innovation as the launch year plus 3, which means that the contribution from innovation will fluctuate over time as some products drop out and new ones come in, but we anticipate that over the long term we will generate a similar level of contribution to that which we have achieved this year. Some of our recent innovation successes are shown on this chart. We have expanded the presence of Fruit Shoot into flavored water with the still and sparkling Hydro range, which has increased revenue by 17% this year. In Ireland, MiWadi Zero drove growth in the squash category and increased its revenue by 40%. In France, our organic-based Pressade increased revenue by 32% following the launch of the Bonjour breakfast juice range. This year, we continued to utilize the strength of the Robinsons brand, expanding it by launching Refresh’d, a low-calorie, all-natural juice and spring water drink that has delivered £4 million in retail sales value in the 19 weeks since launch. And, as I said earlier, R Whites has grown revenue by 13%, thanks to the addition of a premium range featuring new, more sophisticated flavors and premium packaging that leverages its heritage credentials. And finally, Purdey’s, a natural energy drink made with natural juice and botanicals, without caffeine, taurine or added sugar, has grown revenue by 29%. So after a successful first year in Brazil, we have experienced the anticipated adverse impact of the macro environment in consumer spending. Our focus has been twofold. Firstly, we have protected and indeed grown margins and profitability in the short term, which we believe will leave us in a much stronger position as the consumer environment becomes less challenged. We’ve taken price to offset double-digit input cost inflation yet continued to take share through strong in-store execution. Secondly, we have continued to invest in the long-term opportunity by expanding our brand portfolio and geographic reach. We have recruited additional commercial resource; and acquired Bela Ischia, the leading concentrates brand in Rio. The business has been successfully integrated this year, and our guidance of BRL 10 million in cost synergies will be exceeded. In terms of innovation, launched -- last year, we launched Maguary Fruit Shoot towards the end of the year. And we continued to roll out and nurture the brand and are starting to extend its distribution into the 5 most populous regions on the East Coast. We’ve also extended our portfolio further into other categories such as tea and coconut water. In the U.S.A., Fruit Shoot has made steady progress this year. We have delivered double-digit revenue increase and reduced our losses. The singles format has increased its market value share, cementing its position as the number two brand in the channel overall and number one in some states. We continue to focus on building distribution, for example in Dollar General where we now have 2 variants of Fruit Shoot being listed in the chiller in over 8,000 outlets. In the grocery channel, we’re now lapping the first year of multipack coming to market. Weighted distribution has continued to increase and now stands at 37%. We have retained all our major listings and are expanding our on-shelf presence in selected retailers. The feedback from retailers is positive, and we are encouraged by the steady progress we have made. Our focus is to continue to build consistent, quality in-store execution where we are listed so that we may drive the rate of sale. We continue to see enough proof points to support our belief that there is a meaningful opportunity for Fruit Shoot in the USA, but it is still too early to call it a long-term success. And now I’ll hand over to Mat to take you through the detail of our financial performance.

Thanks, Simon. Good morning, everyone. Before we dive into the detail of our financial performance, I thought it would be useful to provide context on the market conditions where we operate. In our European markets, the soft drinks category performed resiliently in 2017, with value growth in GB, Ireland and France. Encouragingly, after a number of years of deflation, we have seen value grow ahead of volume in all of our markets this year. The numbers quoted here are for the off-trade grocery and convenience sector rather than the total market, but they give you a flavor of the resilience that underpins the category. As you can see from the slide, growth in the year was constrained by a weaker fourth quarter, particularly in GB and France where the weather in the school summer holiday period was a damp squib following a great start to the summer in June, early July. In Brazil, the soft drinks category has been hit by the fall in consumer spending, as have many other FMCG categories, with a double-digit drop in volume translating into a, around a 6% drop in retail value. Whilst the environment undoubtedly remains difficult and the outlook remains uncertain, we have seen signs of improvement more recently. In the context of these market conditions, Britvic has delivered another strong set of results in 2017. Our organic performance has been good, with revenue up 2.5%, EBITA up 5.6% and margin up by 30 basis points. These results reflect the successful execution of our strategy, with both revenue growth and our cost management activities playing a role in this performance. Reported margin has declined 30 basis points due to the stronger euro increasing the contribution from France where we have a private label business, Ireland where we have a large wholesale business and the inclusion of Bela Ischia in Brazil. Adjusted EPS has increased by 7.3% to 52.9p. This benefited from the strong EBITA growth; as well as lower interest costs, reflecting our refinancing activities in the earlier part of the year; as well as a lower-than-anticipated tax rate due to the one-off benefits of the reduction in the future French corporation tax rates on our deferred tax liabilities. Given our strong performance and the confidence in future prospects, we have declared a final dividend of 19.3p, resulting in a full year increase of 8.2%. Despite our continued investment in our GB supply chain and the completion of 2 acquisitions this year, our net debt-EBITDA ratio of 2.0 times is in the middle of our stated range and at the lower end of our expectations at the start of the year. The investments we have made will no doubt strengthen our business. And our strong cash flow generation has allowed us to make these investments whilst retaining our strong funding platform and financial flexibility. Turning now to our business unit segmental performance. GB carbonates generated strong growth led by Pepsi Max and R Whites, as Simon has already referenced. ARP increased due to the implementation of new promotional price points in the off-trade and positive mix from a 13% increase in revenue from on-the-go consumption packs. Brand contribution margin declined 120 basis points because of increased A&P investment, cost and foreign exchange pressures, as well as increased sourcing of product from Ireland as we managed to do our line changeovers in the supply chain. As you all know, the second half of the year benefited from the changes we made to our pricing promotions framework in the spring. GB stills volume grew for the first time since 2010. Revenue declined in the year primarily due to price deflation in Robinsons in what remained a competitive squash category. Robinsons declined in the final quarter against a strong comparative last year. This was particularly pronounced given the strong promotional program we executed in the third quarter and the longer consumption time of squash when compared with our other products. J2O also declined in the year as it transitioned to new promotional price points in the off-trade. Whilst the Fruit Shoot brand was flat, the focus on the Hydro variant resulted in further growth as it captured an increased share of the flavored water category. Underpinning our strong GB performance was the continued success of our partnership with Pepsi and in particular the continued success of brand Pepsi and Max. Pepsi has continued to drive category growth and gained share this year, driven by Max. It remains the number one black cola variant in blind taste tests, and it outperforms against all other no-sugar variants. In recent years, we have broadened its appeal further with the introduction of cherry and ginger variants. And the brand has benefited from the long-term focus and investment we have continued to put behind it. GB stills performance is improving. However, it fell behind our expectations this year largely due to a disappointing Q4. In squash, a deflationary environment has persisted. However, whilst core range Robinsons volume declined marginally this year, it benefited from the launch of Refresh’d. And its brand health measures have improved. Brand awareness is high. And the attributes of real fruit in every drop and the link to healthy hydration are resonating with consumers, with more consumers considering the brand than a year ago. As I referenced earlier, J2O has declined this year. A key factor has been the loss of feature and display in grocery resulting from the implementation of higher promotional price points. In the coming months, we are introducing some new PET formats to regain promotional slots with retailers. Alongside this, we have just refreshed the look of both core J2O and J2O Spritz with new packaging across the range. Fruit Shoot has performed better, and our focus on the Hydro variant is paying off. Despite the category the core brand plays in remaining challenging, we have again seen an improvement in overall brand health, with Fruit Shoot being front of mind for more shoppers than it was a year ago. In France, our performance was strong in a difficult market, and we took market share. After a good first 9 months of the year, the poor late-summer weather led to a weak soft drinks category performance in the final quarter and had a particularly high impact on syrups. The continued focus on the brand portfolio generated a 5% increase in branded revenue, partly offset by a decline in private label. Pressade and Fruit Shoot continued to deliver growth, more than offsetting the subdued syrups performance. The consolidation of buying groups has continued to create challenges, particularly in syrups category pricing, although pricing improvements were realized in juice in order to protect profitability. The weaker performance in the last quarter, combined with up-weighted A&P investment and cost pressures resulted in a reduction in brand contribution on a constant currency basis, with the growth in lower-margin juice further impacting margins. In Ireland, performance was excellent despite intense price competition, particularly in carbonates. Growth in owned-brand products was led by the predominantly low and no-sugar stills portfolio. Counterpoint benefited from an improved offering across its alcohol and snacks range as well as from the acquisition of East Coast earlier in the year. The margin decrease is a result of both the price competition; and the growth in the sale of third-party brands in the wholesale business, which generate a lower margin. In Brazil, the underlying organic constant currency performance ebba across the year was impacted by the well-publicized macroeconomic challenges. However, we anticipated these to a certain extent and in what has been an incredibly tough environment, the team have delivered an outstanding result, executing robust price realization to protect margins and take share -- taking share to grow brand contribution by 7.5%. International has continued to generate revenue growth and increase margin. The U.S.A. benefited from the launch of Fruit Shoot -- the Fruit Shoot multipack last year, resulting in a 21% increase in revenue. In Benelux, there was a continued focus on improving margin and mix. We continued to invest in our international business for long-term growth, but as is evident from the strong contribution margin improvement, we have seen our efforts to improve the profitability of the business unit delivering results. We’ve also continued our relentless focus on cost efficiency, and this has delivered good results. A&P spend declined by £3.6 million on a constant currency basis. Whilst branded spend did decrease marginally, a large element of the overall reduction was the result of efficiencies in our nonworking A&P spend. This continues to reduce as a percentage of our overall investment, driven by efficiencies in agency fees, research and production costs, enabling us to direct spend into consumer-facing activity or points-of-purchase activation. Fixed supply chain costs have increased due to incremental depreciation from our GB investment program, whilst selling and overheads and other costs have benefited from our rigorous approach to cost control. We took proactive cost action by extending our business capability program to incorporate £5 million of overhead savings in 2017. This includes a flattening of our structure in some areas as well as reducing duplication between our business units through the combination of some roles. Our total fixed cost base has also benefited from gains in our proactive foreign exchange hedging program. Our focus on cost efficiency has underpinned the progress we have made in continuing to grow our margin. Since 2013, we have increased our EBITA margin by 230 basis points from a low of 10.4% to 12.7% today. This year, we added 30 basis points of organic margin, whilst reported margin, as I mentioned earlier, did decline by 30 basis points due to FX translation and acquisition dilution. Whilst we are still below best-in-class levels, we have identified six clear drivers of margin that you can -- margin growth that you can see here on the slide. The GB supply chain program in particular will deliver substantial benefits, and Simon will take you through this in more detail shortly. As well as our track record of margin improvement, we have worked hard to achieve a strong balance sheet and long-term funding platform to support long-term sustainable growth. We have generated free cash flow of £54.5 million despite investing £147 million in CapEx in our business and in particular in our business capability program. This has been supported by a more rigorous approach to cash management and our working capital management in particular. We have also looked to opportunities to dispose of nonproductive assets, and as indicated at the start of the financial year, we have disposed of property for a consideration in excess of £17 million. As a result of our strong cash management this year, adjusted net debt-to-EBITDA has come in at the lower end of our guidance range. As we head into next year, we are coming to the end of the elevated CapEx spend driven by the GB supply chain program and we will see a significant step-up in free cash flow generation from 2019. We have also completed a number of refinancing activities, which have further strengthened our long-term funding platform. The improving cash flow conversion from FY’19, I just referred to, will provide a number of options. We have been consistent over a number of years in our capital allocation priorities across three key areas; offering a progressive dividend policy based on a 2 times cover; investing back into our business where we see an attractive return, such as with our GB supply chain program; and lastly, executing selective M&A as we have with the recent acquisitions of Bela Ischia in Brazil and East Coast in Ireland. Our long-term objective is to ensure we have sufficient financial flexibility to pursue these goals in concert. Our net debt-to-EBITDA target range of 1.5 to 2.5 times achieves this aim whilst providing cover for unforeseen risks or shocks to this -- to the business. It remains an appropriate range for us in the medium term. Turning now to next year. Both the introduction of the soft drinks levies in the UK and Ireland; and IFRS 15, which we intend to implement in 2018, will affect our reported results. From an accounting perspective and for the soft drinks levy, our reported ARP will increase to reflect the passing-on of the soft drinks levy to retailers, which we will do in full. Our cost of goods will also increase to reflect the levy which we pay over to the government. Whilst the net P&L impact of the accounting is zero, we anticipate it will reduce both reported brand contribution and EBITA margin percentages. The implementation of the IFRS 15 accounting standard requires us to make two reclassifications. Firstly, some of our customer-related investment spend will be reclassified from selling and distribution costs and will be instead treated as an offset to revenue. Secondly, we will reclassify certain incentives received from suppliers from revenue to cost of sales. As a result, our reported revenue will reduce, and so will our cost base, with zero impact on profit. Our reported EBITA margin will increase because of this change. With these two changes happening in the same year, we will look to provide as much disclosure as possible. To improve comparability, we have drafted a restatement of the 2017 financials for the IFRS 15 change. The full restatement will be made available on britvic.com in a few weeks and well ahead of the Q1 trading statement. In terms of guidance for 2018, we anticipate input inflation this year will be in the low single digits from a combination of underlying commodity inflation and FX as hedges roll off Capital spend for the year is proposed in a range of £140 million to £150 million, subject to consultation surrounding our Norwich site. This figure, as I have already mentioned, represents the last year of elevated capital spend as we complete the GB supply chain investment element of the business capability program. Taking into account the proposed elevated capital spend and our commitment to a progressive dividend policy, we anticipate that debt leverage at the end of the year will remain within our target operating range. And it is likely to come somewhere in a range of 2.1 to 2.3 times. Our effective tax rate for the year should be in the range of 22.5% to 23.5%, depending on our mix of profits, whilst our interest charge will be marginally higher than F’17 due to increased debt levels and rising interest rates in the UK. I will now hand back to Simon, who will give you a perspective on our strategy and plans for 2018.

Thanks, Mat. Mat has shared the 2017 results. And I would like to take a moment to remind you of the progress we’ve made in delivering the strategy that we shared in 2013 and some highlights for 2018. The 4 strategic pillars you see on the slide are as relevant today as they were in 2013, and we believe they will continue to deliver strong returns for shareholders going forward. Over the last 4 years, we have delivered consistent growth and created significant shareholder value. On average, revenue has increased by nearly 4% per annum. And our revenue outside of GB has increased from 34% to 41% as we internationalize our business. EBITA is up over 9% per annum, and we have expanded EBIT margin by 230 basis points over the 4 years. This has translated into EPS growth of nearly 11% per annum and DPS growth of 9.5% for our shareholders. We are proud of our track record, and it gives us confidence in the validity of our strategy. For 2018, we have comprehensive plans in place against all 4 pillars of the strategy. However, today in the interest of time, I will just share some of the key highlights against each pillar with you before we close and move to Q&A. So as Mat has already highlighted, 2017 has been another outstanding year for Pepsi Max in a highly competitive category. 24 years on from its launch, Pepsi Max has a retail value of £280 million in the take-home channel. In the last 4 years alone, that value has grown by over £100 million. And Pepsi’s share of cola has increased by 6% to over 28%, driven by Max. In 2013, we launched Pepsi Max Cherry, which continues to grow, with its 2017 retail sales value increasing by over 20% to £53 million. And in 2017, we launched Pepsi Max Ginger, which has generated another £6 million in retail sales value, of which 52% was incremental to the category. Cherry and ginger have both broadened the appeal of Max, attracting 1.1 million new consumers into the brand in 2017. We have a comprehensive plan for Pepsi Max this year, with our Christmas activation now happening, and as we head into 2018, we’ll see major marketing campaigns across the year. This will include a continued focus on taste through the "if you don’t love it, you haven’t tasted it" campaign and on leveraging Pepsi’s long-standing relationship with football through Champions League activation. The Pepsi portfolio will also benefit from our investment in the business capability program as we step change our ability to bring new pack formats to market, which will be particularly important with the advent of the soft drinks levy in April. Robinsons is the number one squash brand in GB and the nation’s most trusted soft drinks brand. However, in 2015, we recognized that Robinsons faced a number of challenges and commenced the reinvigoration of the brand. We reformulated the liquid to create clear preference versus own label and delisted the added-sugar variant. We also began to broaden the shoulders of Robinsons into new consumption occasions, starting in 2015 with the launch of Squash’d to target usage out of home and followed in ‘16 by taking it into dispense and Subway and subsequently KFC. Finally, in 2017, we launched Refresh’d as a ready-to-drink all-natural product for on-the-go consumption. We’re now embarking on the next stage with the reset of the squash category into good, better and best; the launch of the better fruit creations, which has twice the fruit content of the good range; and carefully blended flavors such as pear and blueberry aimed at older families. In addition, we are launching a premium cordials range in a 500-mL glass bottle aimed at adults and sweetened by naturally sourced stevia and sugar, with combinations of real fruit and botanicals such as crushed lime and mint. Both ranges are margin enhancing, continue our commitment to lead on health, and are exempt from the sugar levy. As we have evolved the brand over the last 3 years, we have maintained Robinsons’ quality and heritage while adapting and responding to changing consumer needs and tastes. Performance is gradually improving, and the customer response to the upcoming propositions has been positive. Looking now at Fruit Shoot. While we recognize that the kids category, as currently defined, faces more scrutiny from parents, we also know that kids are actually drinking more, not less. We’re confident by that, by utilizing our insights into what parents and kids really want, we continue to develop a proposition that appeals to both the gatekeeper as well as to children themselves. Since launching the brand in 2000, we have been developing Fruit Shoot in different ways, taking it internationally into all of our markets and developing local flavors to suit local tastes; developing Hydro and Hydro sparkling, a sugar-free, flavored spring water drink intended for older children. We’ve taken out added sugar and reduced sweeteners and are adding vitamins to the core range; and launching the first-ever global Fruit Shoot campaign, It’s My Thing, which celebrates real kids doing their thing whatever that may be. We have also had a strong innovation pipeline, and we are currently taking all natural, an all-natural product called Juiced into the trade in GB. It’s 50% water and 50% juice and sweetened only with real fruit and is schools’ compliant. While we are some months away from launch in mid-2018, feedback has been positive from all of moms, kids and customers, so we believe this will help create further momentum by the, behind the Fruit Shoot brand. In 2018, we will continue to invest in growing our international footprint. In Brazil, while it’s much too early to call a turn in the market, we are seeing signs of stabilization. We will continue our innovation program in 2018 with further launches in our existing categories of concentrates and ready-to-drink juice. Our innovations are designed to promote easier consumer use such as our presweetened uno concentrate and to offer healthier options such as Maguary with stevia. We’re also broadening the portfolio into other categories through the continued national rollout of Fruit Shoot; and the development of our iced tea brand Natural Tea and our coconut water Puro Coco. Bela Ischia is now fully integrated. And we are taking advantage of the enhanced route to market in and around Rio to build further distribution of Fruit Shoot and the broader portfolio. In the USA, we are working closely with Pepsi to expand singles distribution beyond its heartland of convenience and gas into front-of-store grocery and looking for targeted opportunities in foodservice. In the multipack, we continue to focus on driving a consistently high standard of execution in store to build the rate of sale, which will be helped by an expanded range. We’ve also taken the opportunity in the back end of ‘17 to bolster our team with the appointment of a new senior specialist in the commercial activation space. Finally, in Benelux, Mat spoke earlier about our success in building margins. We’ll continue to invest behind the established Teisseire and Fruit Shoot business, but just as importantly we’re also testing the appeal of some of our other brands such as Purdey’s and our premium adult portfolio in those markets. Since 2013, we have led the industry in taking steps to help consumers make healthier choices through targeted reformulation, better-for-you innovation, and responsible marketing, meaning that we haven’t had to knee-jerk following the announcement of the soft drinks levy. We believe in choice and offering a uniquely strong and broad portfolio which delivers both great taste and better-for-you options. By next April, 72% of our total portfolio and 94% of our owned brands will be under the levy in GB; in Ireland, 69% of the total portfolio and 79% of our owned brands will be exempt. And while we can’t go into too much detail with regard to our commercial strategy due to competitive sensitivity, we -- our well-placed portfolio is underpinned by a clear commercial plan in F’18. We will be transparent on price. And while we don’t set retail prices, we’ll always pass on the levy for products where it applies, as the government intended. We will update our promotional activity to accelerate consumer purchase towards low and no-sugar variants. And we are actively working with our customers in both the on and off-trade on how to best merchandise the fixture to ensure the best outcome for the category. Of course, the introduction of a levy of this nature creates the level of short-term uncertainty, but we are confident that we phase into this uncertainty from a position of strength. Our business capability program, as implemented to date, is firmly on track to deliver sustainable long-term benefits. In GB, we have continued to make significant progress at our production sites, with new lines and warehousing coming on stream as well as groundworks for the final phase. At last year’s preliminary results, we announced a £5 million cost-saving initiative, which we have delivered by streamlining our group management structure. And we have also outsourced distribution and warehousing in Ireland. In October, we announced a proposal to transfer production of Robinsons and Fruit Shoot from our Norwich site to our manufacturing sites in East London, Leeds and Rugby. As a result, we are proposing to close the Norwich manufacturing site towards the end of 2019. And we remain in consultation with impacted colleagues. We are committed to a full and proper consultation with those impacted employees, and we are very grateful for their hard work. And our proposal is in no way a reflection of their performance or commitment. On completion, our GB supply chain investment will have truly step changed our supply capability. We will have reduced production and distribution costs and created a platform to deliver long-term sustainable growth. Our capacity will have increased with more efficient lines, more warehousing space and a reduced need for project capital when we introduce new pack formats or innovation in the future. For example, our new can lines in Rugby give a 40% increase in capacity compared to the old lines. And our site in East London has now doubled its storage capacity. Our new lines also offer greater flexibility of packaging. We can make PET carbs and stills on the same lines, use different materials such as steel and aluminum cans and produce different size packs to help us differentiate across channels and at key price points such as 3-liter carbonates value pack or a 1.5-liter contour bottle. We have also increased efficiency with faster and more efficient lines which have shorter changeover times and which are sited closer to the point of demand. The 3 new can lines in Rugby are the fastest in the world. And the new large PET lines in London and Leeds are twice as fast as the lines they have replaced. And finally, once fully commissioned, our new lines will reduce our water and energy consumption. For example, in East London the new PET line is 30% more energy efficient than its comparable old lines. And as a result of all the new equipment commissioned to date, we have already eliminated over 300 tons of plastic bottle packaging in GB in 2017. From a financial perspective, we remain on track to achieve our previously stated guidance, subject to consultation at Norwich. So in summary. Despite input cost inflation and macro uncertainty, we have delivered another strong performance in F ‘17 and are well placed to navigate the headwinds in 2018. We have maintained our focus on cost and efficiency; and demonstrated our ability to realize price, grow our organic revenue and margins, and we believe we have the best provision -- best-positioned portfolio to phase into the forthcoming soft drinks levy from a position of strength. Our investment in the long-term growth drivers of innovation and internationalization is bearing fruit. The contribution to revenue from our owned-brand innovation is growing, demonstrating our ability to effectively innovate into growing consumer segments. And an increasing proportion of our business is generated outside of GB. Our business capability program is entering its final phase. It’s delivering in-year benefits ahead of guidance and will deliver further benefits going into 2018 and ‘19. We are confident of further margin growth over the long term and of improving cash flows as the business capability program nears completion. Overall, we approach 2018 with confidence and expect to deliver continued progress. So thank you for listening to us. And Mat and I will now take questions. A - Simon Litherland: There is a couple of mics coming around. And if I could please ask you to just state your name and the company that you come from before you speak so that it’s there for the webcast.

Chris Pitcher from Redburn. Mat, I was wondering if you could hazard a stab at what the sugar levy may mean to cost-of-goods inflation, because you’ve guided to low single-digit input cost inflation, but obviously that’s only part of the story. And then also, on A&P spend at 4.5% of sales, could you give us a feel for where that’s going to progress in terms of delivering the innovation targets? And a final one, could you have a stab at fiscal ‘19 CapEx to understand what the dropoffs are likely to be?

Do one and three, and I’ll do two.

Okay. Do you want to do two, first, and then I’ll do the other two?

Okay, all right. So yes, on A&P 4.5%, we generally have made some good progress at reducing our non-working spend, but I would expect A&P to tick up over time as we bring more brands to market and invest behind our core brands. But having said that, you’ll notice that a good majority of our innovation is actually off the shoulders of our core brands. So we get the benefit of advertising and marketing behind, for example, Robinsons Refresh’d, flowing over into Robinsons in totality. So I think we’ve been quite efficient with our spend as well.

So from a, let me deal with the CapEx one first. So I think it, I guess I am hazarding a guess in terms of it’s very early to be talking about F ‘19, but if you look at the level of elevated spend of, in the region of £70 million to £80 million, that will give you a feel for what our underlying CapEx is on an ongoing basis. But that would be a very indicative view just based on taking out what we’ve been investing over and above. And we would expect to get some maintenance CapEx benefits over time, but exactly what comes through in F ‘19, it does, and it also slightly depends on exactly the conclusion of the consultation process in terms of whatever may happen and over what time frame. From a sugar levy perspective, you’re quite right to say effectively our commodity costing guidance excludes the impact of the sugar tax. In terms of the potential impact, I guess the rates are well known. And one can estimate the impact that, that would have based on our current volume and mix, but I guess the biggest uncertainty is what’s going to happen to that volume and mix and, therefore, it’s very hard to give you a specific number, I think; as well as the uncertainty we face, we’re also aware of what our competitor, we need to understand competitive reactions, what are retailers going to do and what our consumers going to do before we will see a firm picture of what impact the sugar tax has on our business.

In terms of what, so working assumption, you’re comfortable that the net effect of price increases and levy means it’ll be gross profit neutral.

From an accounting perspective, yes. In terms of what happens to the volume and where that goes, that’s where the uncertainty comes through.

Richie Felton from Morgan Stanley. Two questions, please. First of all, when you think about the sugar tax next year, clearly on Robinsons you’ve done a lot of work, removing the no-added-sugar variants. Could you give us a little bit of color about what -- so your competitors in private label, how they’re positioned? Have they had -- taken similar steps to remove sugar from their brands or do they still remain above the sugar tax levy currently? And secondly, a quick question on the London Essence. Seen it increasing, more bars in London, it’s got a decent shelf space in the off-trade. Any comment on how that brand is progressing and your plans going forward?

Yes, I mean, I don’t know all the competitor plans, I have to say, but I think it’s some and some. So I do think it’s important that there is still choice for consumers. We have seen some own-label take up in the added sugar. So Tesco, I think, was the first retailer to do that in a strong way. And some other competitors have indicated that they will change the formulation of some of their brands. Some have been done. Some are yet to be done, so that’s -- we kind of have to see how that plays out, but I think it will be some and some. And then your second question, in terms of London Essence. Yes, we’re kind of pleased with the progress. It’s obviously a slow build with a premium brand like London Essence, but we’re in about 200 premium outlets across London. And the brand is really well received by barmen in particular in terms of mixing them. And we’re pleased with the progress we’re making. And we’re moving to premium off-trade over Christmas, so you’ll start to see London Essence appearing in Waitrose, for example, for the Christmas period. So we’ll see how that progresses.

It’s Andrea Pistacchi from Deutsche Bank. two or three questions, please. First, on -- value is returning to the UK soft drinks, as you were saying, in part driven by the cost pressures, yet you’re still seeing a lot of deflationary pressures impacting -- because of private label impacting Fruit Shoot and Robinsons. So how sustainable do you see this situation, this deflation in private label from their point of view? And then the second question, on J2O. A lot of innovation plans on -- across your portfolio, I think, except we didn’t hear anything on J2O, I think, given 2017 was a little light in terms of J2O innovation. So what is the long-term ambition for this brand? And then the third one, on the on the go, I think you said double-digit growth in carbs for on the go. The summer clearly didn’t help from that point of view, so what specific plans have you been doing to enhance the on the go, which is, of course, high margin?

Okay, do you want to do one and two? Do three.

Okay.

Yes. So we are seeing value come back. So obviously two, three years of deflationary pricing. I think raw materials and the impact of foreign exchange has meant that pricing started to come back into our category, and we have successfully taken price. We’ve done it on a selective basis, both through headline price and through promotional effectiveness, and have been quite choiceful where we’ve done it, but in totality we’ve successfully taken the price that we wanted. And we’ll do that again in 2018. Specific brands like Robinsons and Fruit Shoot, one of the reasons that those are attractive to the discounts is because of the depth of penetration and consumption that the categories have. And you will see the price point in those brands moving up, particularly through promotional strategies. But also what we’re trying to do is put value back into our brands. So the things I’ve talked about in the presentation, reformulation, we’re really confident that core Robinsons tastes great and tastes better than the competitive set and tastes better than own label. Things like creations at the better and cordials at the premium range will be at higher price points, will be at better margin for us and our customers. And so we will start to put value back into the category in that way. Likewise, margins are accretive on Hydro for customers and ourselves. And Juiced will be a premium-priced offer, so we’ll start to trade consumers up if they’re looking for healthier better-for-you options. So it’s a journey, but I’m comfortable we’ll start to create more space between ourselves and own label, which is a big competitor for those categories. On J2O, we didn’t do a specific slide on it, but there’s lots still happening on that brand. I mean it’s a -- still a massive brand. And we successfully took price this year, albeit with some volume downside mainly because we lost feature and display. It is a brand that really does respond well to being visible and being seen in store. People buy more, drink more. You will notice in store a new pack delivery which significantly increases standout and makes it look more premium, because the J2O competitive set has grown significantly over the last few years. And we’ve also changed the spritz packaging. So the spritz liquid is fantastic. It’s really well liked by consumers. I think the packaging has probably not been optimal, so we’ve made a good step going forward. You’ll start to see that come into store in the coming weeks and months, aligning spritz closer to the core but also making it look more premium and more special. And on top of that, we’ve got a new marketing campaign that will come to market in the new year, which we’re very excited about. So lots happening on J2O. And the penetration of spritz is still quite low, so there’s still lots of distribution opportunity. And I think that we can get trial behind J2O Spritz it will appeal to older, more sophisticated consumers and drinking occasions; and will certainly benefit the brand. You, on the go?

Okay, yes. So I think and from an on the -- I mean I think the first thing to say is that there is a underlying consumer shift to shopping on the go, and I think we see that trend continuing. In addition, we’ve been focused on trying to extend our distribution and reach. We’ve invested a little bit in incremental sales activity to do that trying to penetrate some of the smaller convenient stores, for example, and because we continue to under-trade in that area relative to some of traditional core grocery, for example. And then we’ve also been looking to extend our contracts in foodservice and, obviously, in foodservice the draft product is a big feature of what’s consumed, but the packaged product plays a critical role. And so as we’ve you take something like Subway or the renewal in KFC, as an example, they would have, they will benefit our on-the-go consumption as well, both draft and packaged. So there’s a lot of activity, but it’s driven by, I guess, being as well distributed as possible and visible as possible where people are shopping on the go and, therefore, capitalizing on the trend. And the efforts we’ve already made in the business capability program give us the pack flexibility to do that and to make sure that we can service that channel fully.

Patrick Higgins from Goodbody. Just 2 questions from me, please. Firstly, on cost efficiency phasing from the GB capability program. Obviously, you’ve delivered a few extra million this year. How should we think about the phasing of that over the next 3 years? And then secondly, just on Brazil and obviously the, you’ve highlighted the macroeconomic challenges there in FY ‘17. How has trading been in the last kind of couple months? And should we anticipate an improvement next year?

Do you want to do one, and I’ll do two?

Yes, good. So I think, from a cost efficiency phasing, I think you should see the additional delivery this year is a pull forward of benefit from F ‘18, i.e. delivered early. I think, in terms of the overall guidance, given we’re still in consultation with regard to Norwich, it’s hard for me to comment, I guess other than to confirm what Simon’s already said, which is the as-stated guidance in terms of our expectations for the end of the program remain in place, subject to that consultation and the conclusion of it.

Yes. And on Brazil, I think we are seeing signs of stabilization. It’s a brave man to call it in a market like Brazil, I guess, but the last 2 or 3 periods, our business has performed better, which gives us some confidence. But I would say one swallow doesn’t make a summer.

It’s Laurence Whyatt from SocGen. Three questions on the sugar tax, if that’s all right. Just could you give us an update on 7UP and whether that will be reformulated ahead of the sugar tax being introduced? We understand that Sprite is going to be. Could you also give us an update on the percentage of your owned brands that are affected by the sugar tax, and also you’re not owned brands? And then finally, we’ve seen some evidence in the on-trade of people splitting their menus out between sugary drinks and non-sugary drinks and pricing appropriately. Are you seeing any evidence among your large contracts of anyone suggesting they may change their menus or make it clear if any of the products contain sugar or not and therefore pricing differently in the on-trade?

Okay. So yes, we will reformulate 7UP. It’ll be in the mid-tier, so it will go from above 8 to between 5 and 8 with a stevia formulation. 94% of our owned brands are unaffected by the levy. So the core brands that are, are Pepsi full sugar and 7UP full sugar, obviously those brands have no sugar equivalents. And obviously, Pepsi Max is the brand that we’ve focused on and marketed by since 2005. And yes, I think the on-trade has actually got quite a way to go, actually, to kind of evolve its, their portfolio and their offering and the way they offer their brands to consumers. We know that we under-trade in Max, for example, in the on-trade, so there’s significant opportunity for us to sell more no sugar in the on-trade. And I think you will see differential pricing starting to come through more in how they segment their menus and their offers, but I think that’s a positive step forward.

Carl Walton from UBS. One on Pepsi Max. In terms of the performance of ginger so far, how is that, compared to your expectations in the first year of cherry? How should we think about the initial performance of that brand and the future potential? And then secondly, on international profitability, I think we’ve heard in the past, it’s international total around 5 million negative, but I think you mentioned maybe the U.S. has improved. So is that now a different number? And any guidance on how that might move going forward?

Okay, I’ll do the first one. So yes, Pepsi Max Ginger, it is more -- I don’t know if you’ve taste it, but it is more polarizing than something like cherry. I personally like it. Others don’t. It’s £6 million retail sales value. So not as successful as cherry, but what it does is it’s just -- there’s more interest in the brand. It’s brought more consumers into the Max franchise. And the key thing about Max is, when you taste it, you love it. So net-net, it’s a positive contributor to the growth of Max.

And I guess, just to build on what Simon -- I guess ginger perhaps has slightly -- has brought in -- 50% of its consumption comes from consumers who don’t traditionally drink cola. So that just, I guess, makes Simon’s point. So from an international profitability perspective, we’ve been in a kind of net investment phase for a while. And I think we’ve previously talked about the fact that we were probably investing to the tune of about 100 basis points of -- into the business. That has reduced, but we’ll still be in net investment mode. And it would be slightly ahead of the number you were referring to, Carl, in terms of what our net investment is into the whole international division.

So last one? Or last couple.

Yes, Andrea Pistacchi again. Given the tax increase in April, how do you think of the timing of the negotiations and potential price increases that you put through in the grocery channel? Will it all be delayed, do you think, because of the tax increases? Or -- and the second -- just that actually.

So yes. We’ll keep it separate. So any price with grocery that we do, we’ll do early. And then the tax will come through at the time of the tax.

So I remembered my -- so second question was for Mat. If you could just provide a little more granularity, please, on the input cost guidance, whether that low single digit, whether that includes a -- is there still a delayed negative impact on FX here? Given your hedges, you’re still getting a bit of a hit there. Therefore, is an underlying raw material inflation actually better than that?

So there is an FX impact in that number as effectively our hedges roll off and, therefore, we get to -- I guess we get towards -- ultimately tend towards spot over time, although we’re still obviously hedging forward. So there is an impact. I think within low single digits, I guess that if you took that out, it’s certainly still low single digits. So I guess it’s where it sits in that range, the FX we’re down to, rather than saying, if you took out FX, there isn’t inflation. There definitely is on a number of the underlying raw materials.

Thank you. Damian McNeela from Numis. A couple of questions on GB stills. I think, obviously, the overall group margin performance has been pretty strong, but if we were to look at GB stills, that performance hasn’t been that great over recent years. I’m just wondering, I hear what you’re saying about the new launches, should we expect GB stills contribution margin to improve next year and beyond? And just specifically on the creations and cordials, you said you’ve got a good customer response. Are you getting additional shelf space for those launches? And then just finally, on the international side of the business I think you’re sort of quoting how much of your business is outside of GB. Can you give us a sort of a sense of how you think about the size of GB on a sort of 5-year view for Britvic and what the potential drivers of that are, please?

Sure. Okay, I’ll do the three and two. And you can do one, margin on stills. So yes, the intention certainly is to get incremental shelf space for Robinsons in totality. And that’s the way conversations are going with customers, but it’s important that we kind of reset the category as well. And what we generally want to try and create is good, better and best. And the conversations that we’re having with customers are positive in that regard. We will see probably more cannibalization between good and creations because some of the flavors will be actually swapped out of good and put them into the creations offer, but we’d expect cordials to be more incremental. But net-net, it will be positive for the brand read overall. But just as importantly, I think it will have a positive impact on the category for our customers. And then the second one, we haven’t actually set a target for the proportion of our business that we want outside of GB, but obviously within our strategy 1 of the 4 pillars is internationalizing our core brands, and that in itself will mean that it will increase over time. And I guess it won’t necessarily be linear either because we’ve said it will either be done organically or through acquisition. So I suspect it’ll be a bit of a journey, but directionally we should see more business outside of GB over time.

So from a margin perspective, I think I guess the first thing I would say is that despite -- I mean your point’s absolutely right, Damian. Actually the margin decline that we saw in stills this year was actually lower than we saw in carbonates and I think that reflects some of the activities that Simon has spoken about. So I guess, in terms of looking forward, I think there are a number of actions that would give us confidence that we’re doing the right thing to build stills margin, whether it’s the good, better, best strategy, whether it’s the innovation which is margin enhancing. We’ve taken price on J2O et cetera, et cetera. At the same time, we have persistent deflation in the category. And so those 2 things are both at play in the margin, and I guess it’s the extent to which those 2 things play out over the course of the next year which will dictate exactly where the margin lands.

Okay, shall we, last 2 questions. Thank you.

Hi. Komal Dhillon, JP Morgan. Just a quick question on the sugar tax again, unfortunately. What demand elasticity are you assuming at this point for stills and carbonates separately going into April next year, please?

So, I think we've looked at elasticity, but I think the challenge with using elasticity models effectively are, there are 2 reasons. Because we've never had differential price points, the exact effect of elasticity and effectively cross elasticity and, therefore, switching, it's very hard to get any level of statistical confidence in any of the modeling. So actually in, the absolute elasticities that one would normally look at in terms of soft drinks pricing, I don't think, are particularly reliable indicators. So we, I guess we think about the levy more from a consumption point of view than we do from an absolute elasticity point of view because there are, but we can't model that effectively. So as a result of that, I think we would expect there to be an elasticity impact, but it's the degree to which switching happens which will dictate what I think the final outcome is.

And then I think the things that affect that, one is consumer choice. Do they switch within a category? Do they stay and pay the price? Do they switch within, into water? Do they switch into juice or juice, so where do they go? That'll have a difference. What our competition do, from a pricing and a strategy point of view. But also how our customers react, how they lay out their menus, to the earlier question, or how they lay out their shelves in store, will also have an impact. And none of that is defined yet. So very hard to predict exactly how volumes will be impacted.

Andrew Holland from SocGen. Just coming back, Simon, to something you said around Pepsi's share. You said it was 28% share, value share. Was that share of cola, or share of your...

Share of cola.

Share of cola.

Yes.

And how do you think that has changed? And how do you think Max's share has changed, say, in the last 5 years?

Yes. So I think we've grown from about, we've grown 6 percentage points in the last 4 years. That £280 million is in the last 24 years. But we've constantly taken about 100 basis points of share, I think, per annum, is probably the average. In 2017, Max actually took 150 basis points of share, Pepsi 40 basis points overall, which meant that obviously Pepsi full sugar and Diet Pepsi lost some share.

And just unrelated to that, you also were talking about reducing non-working spend in A&P. Presumably you don't set out to spend money that doesn't work. Can you give us some examples of non-working spend that you're successfully reducing?

Yes, we can, certainly. Do you want to do that?

Yes. It's probably not the best-named spend in the world. So what we mean by non-working spend is spend that doesn't directly touch a consumer. So that, but that would include, for example, producing adverts. So it's just, our measure is what directly can touch as a consumer at the point of spend versus something that goes into our ability to market our products effectively. So when we call something non-working, we don't mean it's not effective. We mean it's not directly targeting a consumer. So it would include spend with agencies, production of adverts, creative...

Research.

Bottle design, research, those kinds of things. So they are things we believe, obviously, we believe they add value, otherwise, we wouldn't do them at all. But what we look to do is obviously generate efficiencies in that, so we've rationalized our agency roster, for example. We've changed the people that do some of the production of our adverts. But we also -- there are efficiencies by using the same collateral consistently, which is a good thing from a consistency point of view. It obviously means you have to do less rework and less development of copy. So there are lots of ways to try and make that efficient. And I think what -- if you -- what we're looking to do is shift the balance to make sure that we're closer to 80% working, 20% nonworking versus we were probably above that historically. So it will never be zero, and it never should be, but it should be somewhere between, it'll vary year by year potentially but somewhere between 15% and 20% on an ongoing basis of our total A&P spend.

Great. Thanks, Mat. Okay thanks, everybody for coming. Good to see you all. And see you soon. Thanks for your questions.