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A n n u A l R e p o R t 2 0 0 7

A n g o s t u r A H o l d i n g s l i m i t e dA n g o s t u r A H o l d i n g s l i m i t e d

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r e p o r t & a c c o u n t s

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a n g o s t u r a H o l d i n g s l i m i t e dA n n u A l R e p o R t 2 0 0 7

Our Vision is to build a

global drinks company,

represented by strong

brands, marketed in every

country around the globe.

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c o n t e n t s

Board of Directors 4

Chairman’s Report 6

Corporate Information 25

Notice of Meeting 26

Directors’ Report 27

Independent Auditor’s Report 29

Consolidated Balance Sheet 30

Consolidated Income Statement 31

Consolidated Statement of Changes in Equity 32

Consolidated Cash Flow Statement 33

Notes to the Consolidated Financial Statements 34

Supplementary Information 86

Management Proxy Circular 87

Proxy Form in back

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Bosworth MoNCK Bsc (hons); MBA Mr. Monck currently holds the position of Managing Director of IBIs Asset Management, a Lon-don based fund management group, regulated by the FsA. he also serves on the board of CL Fi-nancial Limited and brings to the Board a wealth of fund manage-ment and investment advisory experience having worked with top rated organisations such as the International Finance Corpo-ration and JP Morgan.

LoUIs ANDrÉ MoNtEILF.C.C.A., C.A.Non-Executive DirectorChairman - Audit CommitteeChairman - Finance Committee

André joined the Angostura Board in 1997. A Chartered Ac-countant by profession, he is the former Group Financial Director of C L Financial Limited. he serves on the Board of many companies and is currently Chairman of the home Mortgage Bank.

B o a r d o fb o a r d o f

LAwrENCE ANDrÉ DUPrEY B.Comm., CMtExecutive ChairmanChairman - Marketing CommitteeChairman - Compensation Com-mittee

Lawrence has been a Director on the Board of Angostura holdings Limited since 1997 and was ap-pointed Chairman in 1999. he is the Executive Chairman of CL Financial Limited, the holding company for more than 65 com-panies with diversified operations spreading throughout the Carib-bean, North, south and Central America and Europe.

NIChoLAs KNoLLYs INNIssM.A. Econ, h.B.M.Non-Executive DirectorMember - Marketing Committee

“Nicky” joined the Angostura Group in 1971 as Marketing Manager and the Angostura Board in 1991. An economist by profession, he played a key role in the growth of our rum brands locally during his career with the group un-til his retirement as Managing Director of Fernandes Distillers (1973) Limited in 1995.

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d I r E C T o r SD I R E C T O R S

PAtrICK BhAKtI PAtEL B.sc. (hons.) Chem.Group Executive Director - ProductionMember - Marketing Committee

Patrick commenced employ-ment with Angostura in 1971 as a Chemist and worked his way through the ranks to Production Manager and was appointed an Executive Director in 1992. he is also a Director on the Boards of st. Lucia Distillers Limited and world harbors Inc.

MIChAEL E. CArBALLoFCCA, CA.Executive Director / secretary Michael joined the Angostura Group in 1991 as Group Chief Ac-countant and has served in vari-ous capacities throughout the organisation. Until recently he was responsible for all matters relating to the Group’s strategic investments before his recent appointment as Group Finance Director of the parent company, CL Financial Limited. he is a Board member of a number of Group subsidiary companies.

GABrIEL J. FArIAB.sC., MBAGroup Executive-Marketing

Gabriel joined the Angostura Group in 2001 as head of Mar-keting. he has a wealth of ex-perience having operated in top executive positions at major cor-porations in trinidad & tobago. A past trinidad & tobago Manufac-turers Association board mem-ber, he also sits on the board of st. Lucia Distillers Limited & Angostura Canada Inc.

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FrAsEr J. thorNtoN

A Chartered Accountant, Fraser specialised in Corporate Finance and joined Burn stewart Distill-ers (BsD) in 1996. he was ap-pointed to the position of UK sales Manager in 1998, Market-ing Manager for Europe and Asia in 2001, joined the Board as Marketing Director towards the end of 2002, and was appointed Managing Director of BsD in oc-tober 2006.

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C h a I r m a n ’ SC h a i r m a n ’ s

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dear FelloW sHareHolders,

Our primary and fundamental purpose at the Angostura Group is to create a solid foundation so as to responsibly build our brands globally in order to deliver superior shareholder value over the long-term.

Our eyes have always been set on the future in order to maximise our prospects for profitable long-term growth. Our business model is centered around the creation of shareholder value by the building of spirits brands in attractive, high growth markets around the world.

I continue to maintain that the real long-term value potential of the Angostura brand lies in global and emerging markets, where we have been consistently investing significant sums over the past few years. This for sure is the only route to create sustainable long-term value for the Group and for you, our shareholders.

Without doubt, the Group has the capabilities and competencies to build enduring brands for generations to come. We are patient, with a long-term view to building and sustaining multi-generational brands.

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Your Group this year has continued apace, seeking to create additional growth opportunities for our brands through strategic investment spend in new and existing markets. Aggressive expansion is being pursued in high-potential international markets by securing efficient route to market mechanisms and execution of high impact marketing initiatives. At the same time, we are investing to enhance the quality and flexibility of our global supply chains along with more streamlined business processes to boost productivity and customer service and also to get our brands into the hands of consumers as efficiently as possible.

We are very much still an evolving Group and we have succeeded in diversifying our business away from local and bulk rum dependency to a branded spirits group, with significant geographical spread. Apart from our well known Angostura® aromatic bitters, our growing Angostura® 1919 premium rum is finding favour throughout major markets in the world.

As we continue this evolution process, we will cement our operating philosophy based on our learnings from the past and our deep seated values that remain with us at present.

•Wewillcontinuetobepassionateaboutbuildinghighqualitybrands,beingrepresentedandenjoyed throughout the world and bringing this joy to all our employees and shareholders.

•Wewillremaincommittedtoachievingexcellenceinallouroperationsandseektoimproveon these, based on best practices.

• TheGroupwillseekouthighquality,highcaliberpeople,bothhereandabroad,with thehonesty, integrity and commitment to excellence that will drive us forward into the future.

S T a T E m E n Ts t a t e m e n t

We are very much still an

evolving group and we have

succeeded in diversifying

our business away from local

and bulk rum dependency

to a branded spirits group,

with significant geographical

spread.

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• Our emphasis on safeguarding our environment and the upliftment of communities inwhich we operate will be central in all our activities.

• Beingaresponsiblecorporatecitizen,especiallyasitrelatestopromotingsensibleandresponsible consumption habits is important to us.

•We will seek to reward shareholders, taking the longer-term view with above averageyields in rates of return.

our inVestment in BelVedere s.a

With our emphasis on seeking to build a premium spirits Group, we made the strategic decision to exit from our Investment in Belvedere S.A, a Paris listed Vodka, Whiskey and Wine Group.

Prior to our disposal, the CL Financial Group’s holding in Belvedere S.A. was 68.4%. This included our shareholding of 35%, reduced from 50.9% during 2006.

“

Vidia p. doodnath, executive manager – laboratory & Quality systems

“our goal is to instill in every employee what their role is in the organisation and how they contribute to continual improvement in our quality, environmental, health and safety management systems. this is being done through training and review of existing policies, procedures and processes. the incident command system to improve our response to emergencies, has been in place and our efforts to reduce accidents and place safety first has already started with reorientation of all employees.”

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carol g. Homer - senior manager-Quality assurance and lab services

“In the Lab, we provide testing services to our internal customers including the blending, bottling and distilling areas. our purpose is to delight our customers by delivering quality service in a cost effective manner with contributions from everyone.

Main objectives of the laboratory include to be customer-driven while creating a capacity for rapid change; management by fact; measurement & analysis of performance, output and results; focus on results and creating value by continually developing key performance indicators.”

ThestrategicacquisitionofBelvedereS.Aandinturn,itsacquisitionofMarieBrizardS.A.hadthe enviable potential to create a superb platform to grow our brands and expand our reach, especially throughout Western and Eastern Europe.

The development of a serious shareholder dispute, however, left the Group with no alternative but to seek a buyer for our Investment and although the net return was negative, after allocating for interest on borrowings, the net result would have been much worse, given the subsequent precipitous fall in the Belvedere share price following our disposal.

our oFFer For lascelles demercado & co. ltd

As previously communicated to shareholders, on December 17th, 2007, Angostura in conjunction with the CL Financial Group launched a formal offer for the acquisition of outstanding shares in Lascelles deMercado & Co. Ltd, a major Jamaican-listed conglomerate, whoseprimepossessionsincludetheprizedAppletonandWray&Nephewrumbrands.

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Lascelles deMercado is a widely diversified Group, rich in heritage, with an extremely strong balance sheet and an excellent leadership and management team, second to none, focused on building brands and creating shareholder value, totally in sync with our overall core objectives.

aleem Baksh - senior manager information technology

“In 2008, we will continue to implement additional sAP func-tionality to improve the business operations. some of these include human Capital Management, Mo-bile sales, Plant Maintenance and Business Intelligence.

the implementation will yield im-proved business processes, a high-er degree of analytical information, increased customer service and re-duction in operating costs.”

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We consider this fit to be extremely synergic in nature, with huge upside potential for us, especially in the areas of global marketing, distribution and supply chain. Given the current positioning of Appleton, well entrenched in the Top 100 Global Spirits Brands, the only brand from the Caribbean to hold such a position, we will no doubt see additional growth opportunities for our brands.

Based on the level of capital injections for the investment, the Angostura Group will eventually control approximately 20% of the Lascelles deMercado Group as part of the overall holding by the CL Group of 86%. We fully expect, therefore, that on completion of the transaction, Angostura will be in a position to equity account for its share of its investment in this very profitable group.

We anticipate that as soon as the transaction is completed, we will be working assiduously towards further investment in global brand development and distribution reach, with the ultimate aim of positioning the Appleton brand further up the Global Top 100 rank and enhancing overall brand value.

tHe Year in reVieW

I am pleased to report that our core operating performance for the year ended December 31st, 2007, has improved over the corresponding period as evidenced

Keith W. leggard, senior manager - trade marketing

“Consistent with the corporate Vision to be numbered amongst the world’s leading spirits companies, the mar-keting team accepts and welcomes the challenge to continue to build a world-class portfolio of rums that strengthens our dominance in the domestic market and grows our pres-ence on the world stage.

As part of this commitment, no effort will be spared in Product Develop-ment and Promotion so as to ensure we exceed consumers’ increasingly diverse tastes.”

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by a solid increase, both in terms of core business turnover and operating gross profit.

While Group gross turnover has increased marginally from $816.8M to $817.9M this year, our core spirits business reflects a solid increase of 15.8% or $102.9M this year, primarily as a result of increased sales recorded in all major classes of our business, both locally and abroad. We have been extremely encouraged by the global growth of Angostura® 1919 premium rum in markets such as the USA, the United Kingdom and France. While much more international marketing spend on our priority rum brands is required to get the desired lift potential, we firmly believe that our best years lie ahead.

During 2007, we sold our Ethanol production subsidiary, Trinidad Bulk Traders Limited (TBTL), to a CL Financial Group related company and recorded a net gain of $57M, which isreflectedinthe“OtherIncome”categorywithintheConsolidatedIncomeStatement.The strategic decision to dispose of this investment lies in our desire to position ourselves with a strategic focus on the development of our core spirits business.

The ethanol business is considered to be a more strategic fit in terms of class of business and risk profile within the CL Financial company that bought the business.

John p. georges, senior manager - production

“we will be working toward improv-ing the efficiency and technical op-eration of our plants. this will reduce operating costs and enhance our competitiveness. we are also work-ing toward a major modernisation of our casking operations to increase productivity and product variety.”

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Despite our improved core operating performance, the Group has been challenged by the reported net loss position of $137.3M this year.

I had noted and advised in my report to shareholders last year, that non-cash gains in the amount of $203M, arising from the upward market valuation at the time in Belvedere S.A. were recognised as mandated by IAS 39. Also, the majority of these gains would have reversed in 2007, creating a non-cash Income Statement Charge upon eventual disposal of the Belvedere Investment.

The resultant effect of this, compounded by the high finance costs in carrying the Belvedere investment for a substantial period during the year, without the expected dividend gains, or ability to equity account for our share of the investment, has led to this one-off, rather disappointing position.

Given the reported results, your Board has thought it prudent that no final dividend will be declared this year. Again, this has not been a particularly easy decision for us to make, notwithstanding the Interim Dividend of 5 cents per share already paid.

We will return to sustained

profitability in 2008 given

the continued buoyancy

in our core businesses this

year and our significantly

reduced debt position.

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When the Interim Dividend already paid is taken into account, total declared dividends for 2007 is 5 cents per share, consistent with that of 2006.

We are confident, however, that we will return to sustained profitability in 2008 given the continued buoyancy in our core businesses this year and the significantly reduced debt position arising out of the Belvedere disposal and related reduced interest costs that we will obviously benefit from.

enHancing sHareHolder Value tHrougH Brand Building

We firmly believe that the only way forward for the Group is to look beyond our local and regional markets and by building strong brand consumer relationships throughout the first world markets, in addition to emerging markets where we are doing a fair amount of market investment activity such as India, South Africa, Australia and the Far East. These markets offer excellent long-term potential. Our Group’s strong brand portfolio, with a growing premium positioning, secures our ability to benefit from the buoyant consumption of premium spirits globally. When our own portfolio of fine spirits is complemented with that of the high quality

genevieve Jodhan, senior manager - logistics & supply chain

“our goal within logistics and supply chain management is to develop a customer-responsive supply chain that will allow us to not just satisfy our cus-tomers, but delight them.

our objectives simply stated are to:

• develop new products faster• reduce inventory levels at all stages• and deliver products faster to our

customers.”

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Our joining of forces

between Angostura and

Appleton and Wray &

Nephew will place us in a

much more commanding

position with broader brand

portfolios.

portfolio of Appleton and Wray & Nephew, we will no doubt have greater opportunities to reach a wider consumer portfolio, with a much stronger marketing platform.

Against a growing international spirits industry, rum in particular has been growing at a rate of 6.5% annually, with continuing shifts toward the premium segments. Growth in the popularity of rum worldwide is being driven by a favourable demographic shift. Rum, unlike other spirit categories, has versatile mixability, and as such benefits from the increased popularity of

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cocktails worldwide. The growing ‘cocktail culture’ places us in an extremely favourable position for further growth opportunities.

We consider ourselves to have unique competitive advantages including our steady, consistent, patient and long-term approach to building sustainable markets and at the same time enhancing the image of our brands.

We are also flexible enough as an organisation to adjust to marketing trends, including packaging in various world markets where we operate.

The international spirits industry is undergoing significant consolidation at present, resulting in fewer but larger spirits conglomerates, driven by the search for economies of scale, with benefits to be gained from product development, to marketing and distribution. Our eventual joining of forces between Angostura and Appleton and Wray & Nephew in the international markets will, without doubt, place us in a much more commanding position with broader brand portfolios.

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We will, therefore, continue our relentless efforts in investing in creative and consistent brand building activities, especially with the brands Angostura® 1919 premium rum, Angostura® aromatic bitters and Angostura® LLB. Our rapidly expanding global presence of these three brands in particular, results largely from carefully selected international investment initiatives, along with the selection of proper distribution channels into the hands of consumers.

We continue to assess the unique demographics on a market by market basis, while seeking out better and more efficient ways to attract new customers and getting existing consumers to talk favourably about our brands. This, however, takes an enormous amount of time, energy and cost.

tHe domestic marKet

Primarily due to inflationary indexed price increases effected on the local market for most of our standard rum products, in addition to the growth in our own premium lines, there have been marked revenue increases in 2007.

sherrand K. malzar, executive manager - Finance

“During 2008 the Finance Dept will contribute to the Company’s efforts to optimise returns to all its stakeholders by:· assisting in improving business processes to enhance efficiency,· ensuring the maintenance of robust systems of internal control,· providing timely, accurate and relevant operating and financial information,· effective treasury management.”

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Our White Oak® brand continued to jump further ahead of its in-house rivals, Forres Park® and Black Label® rums and to dominate the No.1 position as the most favoured and loved rum brand in Trinidad and Tobago. With its imagery and price point, we have struck a favourable chord with consumers and we plan to maintain this position.

With current economic boom conditions that still appear to favour imported, more expensive lines such as Scotch Whisky, our domestic rum business as a category has not shown the robust growth as expected with general consumption patterns that are currently taking place. Nevertheless, our rum brands still continue to have an overwhelming and commanding share domestically.

Our efforts within the domestic market continue to be centered around image upliftment and exciting consumer campaigns

ioan m. lloyd - senior manager - engineering maintenance

“our department has 2008 objectives which are in line with company goals. our overall goals are to reduce utility costs and provide the departments with good and consistent service. we train our per-sonnel in best manufacturing practices through internal training and, where applicable, by external training, so that our products can meet world-class standards.”

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designed to reflect the quality, heritage and mixability, while promoting the responsible consumption of our brands. Angostura continually refines its marketing strategies and capabilities, allocating the required resources to support the growth and development of its brands depending on the position within their market cycle. It is our objective, however, to be at the forefront in terms of marketing expertise and brand development, the crucial differentiator in the world of premium branded spirits.

We have also recognised the need to further streamline our distribution systems and have embarked upon more efficient methods to ensure a seamless approach to getting our products into the hands of consumers as cost efficiently as possible. We are also committed to stepping up our trade activation efforts at points of consumption and hiring and retaining the best people to continue to ignite the sparks, so essential in this type of brand building business. Of significant importance is our need to continually attract and retain competent and motivated sales and brand professionals with an innovative mindset and desire to connect our brands with consumers and nurture and retain this partnership for the very long-term.

peter traboulay - senior manager, research and product development

“our research plans include processing and filtration of rums to lower cost and maintain or improve quality. we have plans for several new products for various markets, including new spirits, liqueurs and flavoured alcoholic beverages and new sauces and marinades. research & New Product Devel-opment is the life-blood of any progressive company. In this regard our plans are consistent with our overall strategy and vision.”

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BulK rum strategY oVerVieW

From the 1990’s, our distillation capacity was increased significantly to produce not only the rum required for the future growth of our brands, but to have bulk rum available for sale to our widening customer base. This initiative, supported by efficient distillery production at its maximum potential is essential for a competitive unit cost per liter of alcohol produced.

robert g. Wong, senior manager - Bulk sales and production

“our objectives in the area of bulk sales and production are to:• maximise bulk product sales volumes and profits.• satisfy the cased goods demands for the local and export market at the best possible cost and

highest quality standards• ensure careful selection of equipment & capital investment.• offer our customers the blends that they appreciate, and the products and varieties that they

deserve.”

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Our rum maturation capacity has also been expanded with added versatility through ageing studies and distillation research to produce premium rums with varying characteristics.

Worldwide trends have demonstrated that smaller distilleries are being incorporated into the business of larger distilleries, mostly due to economies of scale and the effect of environmental regulation and compliance rulings. Larger distilleries, such as ours, now supply international brand owners, resulting in the formation of long-term, enduring partnerships. Gross Profits generated from our bulk business have been improving at very healthy rates, despite continuous challenges in controlling raw material input cost such as molasses. Our customer base continues to grow as we present greater choice, quality and profiles, in line with consumer demand within the international market place.

Our Strategic Objective is to gain further market share within the bulk current and aged rum business by focusing on our customer needs in the different market segments. Our bulk rums aremarketed as “authentic”Caribbean rums of Trinidad and Tobago origin.With theeventual erosion of preferential trading blocks, we have taken the right steps in maximising our distillery capability and technical upgrading for cost leadership, product differentiation, consistent quality and a high service level in this highly cost competitive market segment.

Kirk a. nancoo, esq. – corporate secretary / counsel

“our Department will support the vision of creating one of the best global rum companies by:

· providing quality legal and corporate services to the Group· maintaining and monitoring globally our Intellectual Property assets: namely, our brands· advising on risk mitigation and dispute resolution.”

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outlooK For tHe Future

Despite the economic slow down being experienced in the United States and some other developing countries and the potential effect that this can have especially within our Caricom region, we believe our future is ever brighter than our past and we look ahead with confidence and extreme optimism.

Over the past decade, we have sought to build a Group focused on creating brands that have potential to stand their ground in the global markets, and a Group with the flexibility and discipline to make the right investments at the right time.

Your Group is making the necessary investments to maximise our prospects for profitable and sustainable long-term growth and we are intensely focused on creating value by driving brand growth.

Considering the significant and growing market for spirits, especially rum, and the strong potential of our brands, the quality and passion of our people and the continuing support of all our shareholders, we have a positive and bright future. We will continue investing for the future, to drive superior results and to deliver the return you expect from your investment in the Angostura Group.

Our efforts to

encourage the

responsible consumption

of our products are of

prime importance and we

are self monitoring in order to be

responsible for our actions.

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giselle laronde-West - manager, corporate communications

“the aim of our department is to maintain and enhance the excel-lent reputation of this developing global company. In doing so, we partner with communities to devel-op education, care for the environ-ment, and improve social, cultural and sporting facilities, thus helping to increase quality of life.”

corporate social responsiBilitY

Wetakeourroleasagoodcorporatecitizenseriously.Ourdedicationtoservingtheneedsof our internal and external communities continued to be one of the main achievements of 2007. By investing in the protection of the environment and assisting the many organisations and institutions in the surrounding community, we do our part in ensuring a better quality life for all.

Our efforts to encourage the responsible consumption of our products are of prime importance and we are self monitoring to ensure that we operate responsibly, above the mandated legal and regulatory requirements, soon to be instilled in the market place.

Our corporate social responsibility is constantly changing and is applied to a wide range of areas from culture, education, sport, terminal diseases as well as environmental, spiritual and humanitarian issues.

Going forward, your Group plans to continue its social responsibility activities with structured projects and continued partnering with the communities, in their efforts to create a better environment through enhanced educational, environmental, social, cultural and sporting activities.

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appreciation

To the many groups of people who contribute to Angostura’s continued success, I express my sincere thanks.

I want to convey my gratitude to Mr. Martin G. Daly S.C., who resigned from the Board in March 2008 to fully concentrate in his new capacity as Chairman of the Law Commission. He has contributed in a very substantial way in the functioning and governance of the Board and we thank him for his wisdom and guidance.

I also wish to thank our dedicated employees, both at home and abroad and especially those with the determination and drive to propel the Group to the desired level of being a truly recognised global company. We are certainly committed to the deepening of a brand organisational culture, fit for purpose and remaining a very attractive employer of choice.

I want to thank you once again for your ongoing support as we continue to build Angostura into the high value drinks group that, I have no doubt, you will be incredibly proud of.

Lawrence A. DupreyChairman10th April 2008

We continue to build

Angostura into the

high value drinks group

that, I have no doubt, you

will be incredibly proud of.

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Company Secretary: Kirk Nancoo, Esq.L.L.B. (Hons.), L.E.C., Counsel

Registered Office: Corner Eastern Main Road & Trinity Avenue Laventille, Trinidad & TobagoE-mail: [email protected]: www.angostura.com

Registrar & Transfer Office: Angostura Holdings LimitedCorner Eastern Main Road & Trinity Avenue Laventille, Trinidad & Tobago

Auditors: PricewaterhouseCoopers, 11-13 Victoria AvenuePort of Spain, Trinidad & Tobago

Bankers: Republic Bank LimitedPromenade Centre72 Independence SquarePort of Spain, Trinidad & Tobago

Citibank (Trinidad and Tobago) Limited12 Queen’s Park EastPort of Spain, Trinidad & Tobago

First Caribbean International Bank LimitedWarrens, St. MichealBarbados

Attorneys-at-Law: J. D. Sellier & Company129 - 131 Abercromby StreetPort of Spain, Trinidad & Tobago

directors’ shareholdings: dec. 31st, 2007 april 10th, 2008

Lawrence A. Duprey Nil NilNicholas K. Inniss Nil NilLouis A. Monteil Nil NilPatrick B. Patel Nil NilMichael E. Carballo Nil NilGabriel J. Faria Nil NilBosworth Monck Nil NilFraser Thornton Nil Nil

Substantial Shareholders:Rumpro Company Limited 92,551,212 92,551,212Colonial Life Insurance Company (T&T) Limited 64,900,981 64,900,981

A substantial interest means 5% or more of the issued share capital of the company.

C o r p o r a T E I n f o r m a T I o nC o r p o r a t e I n F o r m a t I o n

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1. To receive the Report of the Directors, the Accounts for the year ended December 31st, 2007 and the Report of the Auditors thereon.

2. To elect directors.

3. To appoint PricewaterhouseCoopers as auditors and authorise the directors to fix their remuneration.

By Order of the Board

Kirk NancooSecretaryApril 10th, 2008

notice is HereBY giVen, that the twenty-sixth annual general meeting of the company will be held at the House of angostura, eastern main road, laventille, trinidad and tobago, on Wednesday, may 28th, 2008, at 10.00 a.m. for the following purposes:

Notes

1. Every member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and on a poll to vote in his place and such

proxy need not be a member of the company. 2. No service contracts not expiring or determinable within 10 years have

been entered into between the company and any of its directors.

n o T I C E o f m E E T I n gn o t i c e o f m e e t i n g

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the directors present their report and statement of account for the year ended december 31st, 2007.

Financial Results for the Year $’000

Loss attributable to shareholders (137,510)Other reserve movements 405Dividends on ordinary stock Interim paid (2006 - 5¢) (10,314)

(147,419) Retained profits from the previous year 1,104,968Retained profits at the end of the year (957,549)

DividendsThe Directors have not declared a final dividend and with the interim dividend already paid, makes a total of 5¢ for the year.

Directors(a) Pursuant to paragraph 4.6.1 of By-Law No. 1 of the Company, Messrs. Louis A. Monteil

and Nicholas K. Inniss retire and, being eligible, offer themselves for re-election until the close of the Annual Meeting next following.

(b) Pursuant to paragraph 4.4.2 of By-Law No. 1 of the Company, Mr. Fraser J. Thornton, who was appointed to the Board since the last annual meeting retires and, being eligible, offers himself for election.

(c) Mr. Martin G. Daly retired frm teh Board effective March 10th, 2008.

AuditorsThe company’s auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office and offer themselves for re-election.

By order of the Board

Kirk NancooSecretaryApril 10th, 2008Corner Eastern Main Road and Trinity AvenueLaventille, Trinidad and Tobago

d I r E C T o r S ’ r E p o r Td i r e c t o r s ’ r e p o r t

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to the shareholders ofangostura Holdings limited

Report on the consolidated financial statements We have audited the accompanying consolidated financial statements of Angostura Holdings Limited (the Company) and its subsidiaries (together, the Group) which comprise the consolidated balance sheet as of December 31st, 2007, and the consolidated income statement, consolidated statement of changes in equity and consolidated cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory notes.

Management’s responsibility for the financial statementsManagement is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance as to whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the accompanying consolidated financial statements present fairly, in all material respects the financial position of the Group as of December 31st, 2007, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

PricewaterhouseCoopersPort of SpainTrinidad, West IndiesApril 11th, 2008

i n d e p e n d e n t A u d i t o r ’ s r e p o r ti n d e p e n d e n t A u d i t o r ’ s r e p o r t

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Note As at December 31st 2007 2006 $’000 $’000ASSETS Non-current assets Property, plant and equipment 6 524,142 604,109Intangible assets 7 286 833Investment in joint venture 9 - 18,682Available-for-sale financial assets 10 138,985 4,975Loans receivable 11 232,599 312,696Pension asset 12 28,961 26,687Cash in escrow 16 20,220 20,087 945,193 988,069Current assets Held-for-sale financial assets 13 348,181 1,544,137Inventories 14 234,687 212,857Trade and other receivables 15 769,463 678,162Cash and cash equivalents 16 22,299 105,162 1,374,630 2,540,318Total assets 2,319,823 3,528,387 EQUITY AND LIABILITIES Shareholders’ equity Share capital 17 118,558 118,558Other reserves 18 111,884 68,928Retained earnings 957,549 1,104,968 1,187,991 1,292,454Minority interest 8,000 8,064Total equity 1,195,991 1,300,518 Liabilities Non-current liabilities Borrowings 19 28,349 531,990Deferred taxation 20 14,035 13,528Other non-current liabilities 21 40,962 134,459 83,346 679,977Current liabilities Trade and other payables 22 248,507 228,840Taxation payable 1,441 132Other financial liabilities 23 - 127,619Borrowings 19 790,538 1,191,301 1,040,486 1,547,892Total liabilities 1,123,832 2,227,869Total equity and liabilities 2,319,823 3,528,387

The notes on pages 34 to 85 are an integral part of these consolidated financial statements.

Director: Director:L. A. Duprey P. B. Patel

C o n s o l i d A t e d B A l A n C e s h e e tC o n s o l i d a t e d b a l a n C e s h e e t

expressed in trinidad and tobago Dollars

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C o n s o l i d A t e d i n C o m e s t A t e m e n tC o n s o l i d a t e d i n C o m e s t a t e m e n t

Year ended Note December 31st 2007 2006 $’000 $’000

Sales 679,384 682,973Cost of goods sold (380,038) (439,783)

Gross profit 299,346 243,190Selling and marketing costs (151,779) (158,214)Administrative expenses (88,009) (115,341)

24 59,558 (30,365)Finance costs 25 (242,545) (248,354)Finance income 26 39,212 66,704Other income 27 93,734 179,018Fair value (losses)/gains – net 28 (63,829) 203,514

Group (loss)/profit before tax (113,870) 170,517Share of results of associate and joint ventures before tax (18,682) 21,438

(Loss)/profit before taxation (132,552) 191,955Taxation charge 29 (4,826) (4,106)

(Loss)/profit for the year (137,378) 187,849 Attributable to: Equity holders of the Company (137,510) 187,752Minority interest 132 97

(138,378) 187,849 Earnings per share for (losses)/profits attributable to the equity holders of the Company during the year: - Basic 30 ($0.67) $0.91 - Diluted 30 ($0.67) $0.91


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Attributable to equity holders Minority Total of the Company interest equity Share Other Retained capital reserves earnings $’000 $’000 $’000 $’000 $’000 (Note 18) Balance at January 1st, 2007 118,558 68,928 1,104,968 8,064 1,300,518 Depreciation on revalued assets - (405) 405 - -Other movements in subsidiary - - - (196) (196)Revaluation of investments - 43,361 - - 43,361Net income/(expense) recognised directly in equity - 42,956 405 (196) 43,165Loss for the year - - (137,510) 132 (137,378)Total recognised income for 2007 - 42,956 (137,105) (64) (94,213)Dividends paid - - (10,314) - (10,314)

Balance at December 31st, 2007 118,558 111,884 957,549 8,000 1,195,991 Balance at January 1st, 2006 118,558 70,019 941,573 8,094 1,138,244 Depreciation on revalued assets - (405) 405 - -Currency translation differences - (1,213) (54) - (1,267)Other movements in subsidiary - - - (127) (127)Revaluation of investments - 527 - - 527Net income/(expense) recognised directly in equity - (1,091) 351 (127) (867)Profit for the year - - 187,752 97 187,849Total recognised income for 2006 - (1,091) 188,103 (30) 186,982Dividends paid - - (24,708) - (24,708)

Balance at December 31st, 2006 118,558 68,928 1,104,968 8,064 1,300,518


C o n s o l i d A t e d s t A t e m e n t o f C h A n g e s i n e q u i t yC o n s o l i d a t e d s t a t e m e n t o f C h a n g e s i n e q u i t y


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C o n s o l i d A t e d C A s h f l o w s t A t e m e n tC o n s o l i d a t e d C a s h F l o w s t a t e m e n t

Year ended Note December 31st 2007 2006 $’000 $’000

Cash flows from operating activities (Loss)/profit before taxation (132,552) 191,955Adjustments for:

Depreciation 6 15,528 23,840Amortisation and impairment charges 7 573 39,621Loss on disposal of property, plant and equipment 1,199 264Profit on disposal of investments (22,230) (184,038)Fair value losses/(gains) – net 28 63,829 (203,514)Option fee on held-for-sale financial assets 27 (76,827) -Pension charge 12 1,220 438Finance costs 25 242,545 248,354Finance income 26 (39,212) (66,704)Share of results of associate and joint ventures before tax 18,682 (21,438)

Operating profit before working capital changes 72,755 28,778Increase in trade and other receivables (199,163) (14,238)(Increase)/decrease in inventories (38,299) 10,798Increase in trade and other payables 32,476 53,870

Cash (used in)/from operations (132,231) 79,208Interest paid (240,864) (248,330)Corporation tax paid (3,806) (6,623)Retirement benefits paid (197) (417)Dividends paid (3,032) (9,814)

Net cash used in operating activities (380,130) (185,976) Cash flows from/(used in) investing activities

Proceeds on disposal of property, plant and equipment 1,133 2,253Proceeds on sale of subsidiary 37 168,795 -Proceeds on disposal of investments 1,057,445 1,071,219Additions to property, plant and equipment 6 (19,253) (96,931)Additions to available-for-sale financial assets 10 (90,649) -Additions to held-for-sale financial assets 13 - (2,069,385)Additions to intangibles 7 (26) (355)Dividends received 26 649 4,019Interest received 38,112 59,292Decrease in other assets 154,817 131,554(Decrease)/increase in other liabilities (94,779) 43,192

Net cash from/(used in) investing activities 1,216,244 (855,142)

Cash flows (used in)/from financing activities Loan proceeds 5,563,371 2,953,656Repayment of loans (6,497,124) (2,284,676)

Net cash (used in)/from financing activities (933,753) 668,980 Decrease in net cash (97,639) (372,138)Net cash balances at January 1st 90,072 462,210Net cash balances at December 31st 16 (7,567) 90,072


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1. General information

The Company is a limited liability company incorporated and domiciled in the Republic of Trinidad and Tobago. The address of its registered office is corner Eastern Main Road and Trinity Avenue, Laventille, Trinidad and Tobago. The Company has its primary listing on the Trinidad and Tobago Stock Exchange. It is a holding company whose subsidiaries are engaged in the manufacture and sale of rum, ANGOSTURA® aromatic bitters and other spirits, the bottling of beverage alcohol and other beverages on a contract basis, the production and sale of food products and the manufacture of fuel ethanol. The principal subsidiaries are:

Company Country of incorporation Percentage Owned

Angostura Limited Trinidad and Tobago 100%Trinidad Distillers Limited Trinidad and Tobago 100%Servis Limited Trinidad and Tobago 100%Occidental Investments Limited Trinidad and Tobago 100% Angostura International Limited United States of America 100%World Harbors, Inc. United States of America 100%Angostura Canada, Inc. Canada 100%

Suriname Alcoholic Beverages, NV Suriname 75%

The Group’s ultimate parent entity is CL Financial Limited, a company incorporated in the Republic of Trinidad and Tobago.

These consolidated financial statements were approved for issue by the Board of Directors on April 10th, 2008.

n ot e s t o t h e C o n s o l i d At e d f i n A n C i A l s t At e m e n t sN ot e s t o t h e c o N s o l i d at e d f i N a N c i a l s t at e m e N t s

December 31st, 2007

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December 31st, 2007 (continued)


2. summary of significant accounting policies

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

2.1 Basis of preparation

The consolidated financial statements of Angostura Holdings Limited have been prepared in accordance with International Financial Reporting Standards (IFRS). The consolidated financial statements have been prepared under the historical cost convention as modified by the revaluation of land and buildings, available-for-sale financial assets and held-for-sale financial assets.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in Note 4.

(a) Standards, amendments and interpretations effective in 2007

IFRS 7, ‘Financial instruments: Disclosures’, and the complementary amendment to IAS 1, ‘Presentation of financial statements – Capital disclosures’, introduces new disclosures relating to financial instruments and does not have any impact on the classification and valuation of the Group’s financial instruments, or the disclosures relating to taxation and trade and other payables.

IFRIC 8, ‘Scope of IFRS 2’, requires consideration of transactions involving the issuance of equity instruments, where the identifiable consideration received is less than the fair value of the equity instruments issued in order to establish whether or not they fall within the scope of IFRS 2. This standard does not have any impact on the Group’s financial statements.

IFRIC 10, ‘Interim financial reporting and impairment’, prohibits the impairment losses recognised in an interim period on goodwill and investments in equity instruments and in financial assets carried at cost to be reversed at a subsequent balance sheet date. This standard does not have any impact on the Group’s financial statements.

(b) Interpretation early adopted by the Group

IFRIC 11, ‘IFRS 2 – Group and treasury share transactions’, was early adopted in 2007. IFRIC 11 provides guidance on whether share-based transactions involving treasury shares or involving Group entities (for example, options over a parent’s shares) should be accounted for as equity settled or cash-settled share-based payment transactions in the stand-alone accounts of the parent and group companies. This interpretation does not have an impact on the Group’s financial statements.

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2. summary of significant accounting policies (continued)

2.1 Basis of preparation (continued)

(c) Standards, amendments and interpretations effective in 2007 but not relevant

The following standards, amendments and interpretations to published standards are mandatory for accounting periods beginning on or after January 1st, 2007 but they are not relevant to the Group’s operations:• IFRS4,‘Insurancecontracts’;• IFRIC7,‘ApplyingtherestatementapproachunderIAS29,Financialreportinginhyperinflationaryeconomies’;

and• IFRIC9,‘Re-assessmentofembeddedderivatives’.

(d) Standards, amendments and interpretations to existing standards that are not yet effective and have not been adopted early by the Group

The following standards, amendments and interpretations to existing standards have been published and are mandatory for the Group’s accounting periods beginning on or after January 1st, 2008 or later periods, but the Group has not early adopted them:• IAS23(Amendment),‘Borrowingcosts’(effectivefromJanuary1st,2009).Theamendmenttothestandardis

still subject to endorsement by the European Union. It requires an entity to capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset (one that takes a substantial period of time to get ready for use or sale) as part of the cost of that asset. The option of immediately expensing those borrowing costs will be removed. The Group will apply IAS 23 (amended) from January 1st, 2009.

• IFRS8,‘Operatingsegments‘(effectivefromJanuary1st,2009).IFRS8replacesIAS14andalignssegmentreporting with the requirements of the US standard SFAS 131, ‘Disclosures about segments of an enterprise and related information’. The new standard requires a ‘management approach’, under which segment information is presented on the same basis as that used for internal reporting purposes. The Group will apply IFRS 8 from January 1st, 2009. The expected impact is still being assessed in detail by management, but it appears likely that the number of reportable segments, as well as the manner in which the segments are reported, will change in a manner that is consistent with the internal reporting provided to the Executive Management and the Board of Directors.

• IFRIC14,‘IAS19–Thelimitonadefinedbenefitasset,minimumfundingrequirementsandtheirinteraction’(effective from January 1st, 2008). IFRIC 14 provides guidance on assessing the limit in IAS 19 on the amount of the surplus that can be recognised as an asset. It also explains how the pension asset or liability may be affected by a statutory or contractual minimum funding requirement. The Group will apply IFRIC 14 from January 1st, 2008, but it is not expected to have any impact on the Group’s accounts.



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2.1 Basis of preparation (continued)

(e) Interpretations to existing standards that are not yet effective and not relevant for the Group’s operations

The following interpretations to existing standards have been published and are mandatory for the Group’s accounting periods beginning on or after January 1st, 2008 or later periods but are not relevant for the Group’s operations:• IFRIC12,‘Serviceconcessionarrangements’(effectivefromJanuary1st,2008).IFRIC12appliestocontractual

arrangements whereby a private sector operator participates in the development, financing, operation and maintenance of infrastructure for public sector services. IFRIC 12 is not relevant to the Group’s operations because none of the Group’s companies provide for public sector services.

• IFRIC13, ‘Customer loyaltyprogrammes’ (effectivefromJuly1st,2008). IFRIC13clarifiesthatwheregoodsor services are sold together with a customer loyalty incentive (for example, loyalty points or free products), the arrangement is a multiple-element arrangement and the consideration receivable from the customer is allocated between the components of the arrangement in using fair values. IFRIC 13 is not relevant to the Group’s operations because none of the Group’s companies operate any loyalty programmes.

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2.2 Consolidation

a) Subsidiaries

Subsidiaries are all entities (including special purpose entities) in which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one half of the voting rights.

The existence and effect of potential voting rights that are presently exercisable or presently convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are no longer consolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement (Note 2.6).

Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

b) Transactions and minority interests

The Group applies a policy of treating transactions with minority interests as transactions with parties external to the Group. Disposals of minority interests result in gains and losses for the Group that are recorded in the income statement. Purchases from minority interests result in goodwill, being the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary.



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2.2 Consolidation (continued)

c) Associates

Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s investment in associates includes goodwill net of any accumulated impairment loss (Note 2.6).

The Group’s share of its associates’ post-acquisition profits or losses is recognised in the income statement and its share of post-acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.

Dilution on gains and losses arising in investments in associates are recognised in the income statement.

d) Joint ventures

The Group’s interest in jointly controlled entities is accounted for by the equity method of accounting.

2.3 Segment reporting

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment that is subject to risks and returns that are different from those of segments operating in other economic environments.

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2.4 Foreign currency translation

a) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in Trinidad and Tobago dollars, which is the Company’s functional and presentation currency.

b) Transactions and balances

Foreign currency transactions are translated into the functional and presentation currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.

Translation differences on non-monetary financial assets and liabilities are reported as part of the fair value gain or loss. Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in the income statement as part of the fair value gain or loss. Translation differences on non-monetary financial assets such as equities classified as available-for-sale are included in the fair value reserve in equity.

c) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:i) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of

that balance sheet;ii) income and expenses for each income statement are translated at average exchange rates (unless

this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

iii) all resulting exchange differences are recognised as a separate component of equity.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders’ equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the income statement as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.



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2.5 Property, plant and equipment

Land and buildings comprise mainly factories, warehouses and offices. Land and buildings are shown at fair value, based on periodic, but at least quintennial, valuations by external independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is restated to the revalued amount of the asset. All other property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Interest costs on borrowings to finance the construction of property, plant and equipment are capitalised during the period of time that is required to complete and prepare the asset for its intended use. Other borrowing costs are expensed.

Increases in the carrying amount arising on revaluation of land and buildings are credited to revaluation surpluses in shareholders’ equity. Decreases that offset previous increases of the same asset are charged against revaluation surpluses directly in equity; all other decreases are charged to the income statement. Each year the difference between depreciation based on the revalued carrying amount of the asset charged to the income statement and depreciation based on the asset’s original cost is transferred from ‘Revaluation surplus’ to ‘Retained earnings’.

Land is not depreciated. Buildings are depreciated on the straight-line basis, and all other fixed assets on the reducing balance basis at rates set out below to allocate their cost or revalued amounts to their residual values over their estimated useful lives: Buildings - 2%Plant, machinery and equipment at varying rates from - 6% to 25%The leasehold land is being amortised over the lease period of 99 years.

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in the income statement. When revalued assets are sold, the amounts included in revaluation reserves are transferred to retained earnings.

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2.6 Intangible assets

a) GoodwillGoodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of the acquired subsidiary/associate company at the date of acquisition. Goodwill on acquisition of subsidiaries is included in ‘Intangible assets’. Goodwill on acquisitions of associates is included in ‘Investments in associates’ and is tested for impairment as part of the overall balance. Separately recognised goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The Group allocates goodwill to each business segment in each country in which it operates.

b) Trademarks and licences

Acquired trademarks and licences are shown at historical cost. Trademarks and licences have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of trademarks and licences over their estimated useful lives (15-20 years).

2.7 Impairment of non-financial assets

Assets that have an indefinite useful life, for example goodwill, are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.



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2.8 Financial assets

The Group classifies its financial assets in the following categories: at fair value through profit or loss, loans and receivables, available-for-sale, and held-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition and re-evaluates this designation at every reporting date.

a) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling it in the short term. Assets in this category are included in current assets as ‘held-for-sale financial assets’ (Note 2.8(d)).

Gains or losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are presented in the income statement within ‘Fair value gains/(losses) – net’ in the period in which they arise.

Dividend income from financial assets at fair value through profit or loss is recognised in the income statement as part of finance income when the Group’s right to receive payment is established.

b) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the balance sheet date. They are carried at amortised cost using the effective interest method. These are classified as non-current assets. Loans and receivables are classified as ‘Loans receivable’ and ‘Trade and other receivables’ in the balance sheet (Note 2.10).

c) Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the balance sheet date.

Regularpurchasesandsalesofavailable-for-salefinancialassetsarerecognisedontrade-date−thedateonwhich the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Available-for-sale financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value. Unlisted equity securities for which fair values cannot be reliably measured have been recognised at cost less impairment.

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2.8 Financial assets (continued)

c) Available-for-sale financial assets (continued)

Changes in the fair value of monetary securities classified as available-for-sale and non-monetary securities classified as available-for-sale are recognised in equity.

Financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed in the income statement.

When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the income statement as ‘gains and losses from investment securities’. Interest on available-for-sale securities calculated using the effective interest method is recognised in the income statement. Dividends on available-for-sale equity instruments are recognised in the income statement when the Group’s right to receive payments is established.

The fair values of quoted investments are based on market closing prices.

The Group assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in the income statement – is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement. Impairment testing of trade receivables is described in Note 2.10.

d) Held-for-sale financial assets

Held-for-sale financial assets are non-derivatives whose carrying amounts are expected to be recovered principally through a sale transaction. For this to be the case, the asset must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets, and the sale must be highly probable. In addition, the sale should be expected to qualify for recognition as a completed sale within one year from the date of classification and actions required to complete the planned sale should indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

Held-for-sale financial assets are measured at fair value through the income statement (Note 2.8(a)).



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2.9 Inventories

Inventories are stated at the lower of cost and net realisable value.

Raw materials are stated at weighted average cost. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity). It excludes borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

2.10 Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the income statement within ‘selling and marketing costs’. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against selling and marketing costs in the income statement.

2.11 Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the balance sheet.

2.12 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Where any Group company purchases the Company’s equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders.

2.13 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.

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2.14 Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.

Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use. Costs incurred in obtaining long term borrowings are deferred and amortised over the term of the loan. Other borrowing costs are expensed.

2.15 Current and deferred tax

The current tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the company’s subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.



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2.16 Employee benefits

a) Pension obligations

Group companies operate various pension schemes. The schemes are generally funded through payments to trustee-administered funds as determined by periodic actuarial calculations. The Group has both defined benefit and defined contribution plans. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. A defined benefit plan is a pension plan that is not a defined contribution plan. Typically, defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.

The asset recognised in the balance sheet in respect of defined benefit pension plans is the fair value of plan assets less the present value of the defined benefit obligation at the balance sheet date together with adjustments for unrecognised actuarial gains or losses and past service cost. The defined benefit obligation is calculated annually by independent qualified actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of government securities that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension liability.

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions in excess of the greater of 10% of the value of plan assets or 10% of the defined benefit obligation are charged or credited to income over the employees’ expected average remaining working lives.

Past-service costs are recognised immediately in income, unless the changes to the pension plan are conditional on the employees remaining in service for a specified period of time (the vesting period). In this case, the past-service costs are amortised on a straight-line basis over the vesting period.

For defined contribution plans, the Group pays contributions to trustee administered funds on a contractual 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.

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2.16 Employee benefits (continued)

b) Share-based compensation

The Group operates an equity-settled, share-based compensation plan. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted, excluding the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. At each balance sheet date, the entity revises its estimates of the number of options that are expected to become exercisable. It recognises the impact of the revision of original estimates, if any, in the income statement, with a corresponding adjustment to equity.

The proceeds received net of any directly attributable transaction costs are credited to share capital when the options are exercised.

c) Termination benefits

Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits.

The Group recognises termination benefits when it is demonstrably committed to either: terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal; or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after the balance sheet date are discounted to present value.

d) Bonuses

The Group recognises a liability and an expense for bonuses based on a formula that takes into consideration the profit attributable to the Company’s shareholders after certain adjustments. The Group recognises a provision where contractually obliged or where there is a past practice that has created a constructive obligation.



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2.17 Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services in the ordinary course of the Group’s activities. Revenue is shown net of value-added tax, returns, rebates and discounts and after eliminating sales within the Group. The Group recognises revenue when the amount of the revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

(a) Sales of goods – wholesaleSales of goods are recognised when a Group entity has delivered products to the customer and the customer has accepted the products. Customers have the right to return spoiled or damaged product.

(b) Sales of goods – retailSales of goods are recognised when a Group entity sells a product to the customer. Customers have the right to return spoiled or damaged product. Retail sales are usually in cash or by credit or debit card. Credit and debit card fees payable for the transaction are included in distribution costs.

(c) Sales of servicesSales of services are recognised in the accounting period in which the services are rendered, by reference to completion of the specific transaction assessed on the basis of the actual service provided as a proportion of the total services to be provided. If circumstances arise that may change the original estimates of revenues, costs or extent of progress toward completion, estimates are revised. These revisions may result in increases or decreases in estimated revenues or costs and are reflected in income in the period in which the circumstances that give rise to the revision become known by management.

(d) Interest incomeInterest income is recognised on a time-proportion basis using the effective interest method. When a receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is recognised using the original effective interest rate.

(e) Dividend incomeDividend income is recognised when the right to receive payment is established.

2.18 LeasesLeases in which a significant portion of the risk and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

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2.19 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s financial statements in the period in which the dividends are approved by the Group’s shareholders.

2.20 Derivative financial instruments

The Group has derivatives which are not classified as hedge instruments. These are initially recognised at fair value on the date the derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of the derivative instruments are recognised immediately in the income statement within ‘finance costs’ or ‘finance income’.

3 Financial risk management

3.1 Financial risk factors The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, price risk, cash flow interest rate risk and fair value interest rate risk), credit risk, liquidity risk and cash flow interest rate 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.

(a) Market risk

(i) Foreign exchange risk

The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the US dollar, the UK pound and the Euro. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.

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 currencies.

At December 31st, 2007, if the Trinidad and Tobago dollar had weakened by 6.0% against the Euro with all other variables held constant, post-tax loss for the year would have been $12,932,574 lower (2006: post-tax profit would have been $72,528,053 higher), mainly as a result of foreign exchange gains on translation of Euro denominated loans and receivables and financial assets at fair value through profit and loss, and foreign exchange losses on translation of Euro denominated borrowings. Profit was less sensitive to movement in Trinidad and Tobago dollar/Euro exchange rates in 2007 than 2006 because the Group’s holding in Euro denominated financial assets was proportionately lower compared to Euro denominated borrowings in 2007 than 2006.



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3 Financial risk management (continued)

3.1 Financial risk factors (continued)

(a) Market risk (continued)

(ii) Price risk

The Group is exposed to equity securities price risk because of investments held by the Group and classified on the consolidated balance sheet as either available-for-sale or held-for-sale. The Group is not exposed to commodity price risk.

To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio.

The Group’s investments in equities of other entities that are publicly traded are included in the following equity indices: Jamaica Stock Exchange main index (Jamaica equity securities) and CAC Beverages index (European equity securities).

The tables below summarise the impact of increases in the above named indices on the Group’s post-tax loss for the year and on equity. The analyses are based on the assumption that the equity indices increased by 5% with all other variables held constant and all the Group’s equity instruments moved according to a positive correlation with the index:

2007 2006 $’000 $’000

Impact on post tax (loss)/profit:CAC Beverages index 9,221 70,514 Impact on equity:Jamaica Stock Exchange main index 6,731 -CAC Beverages index 37,030 19,214 43,761 19,214

(iii) Cash flow and fair value interest rate risk

The Group has significant interest-bearing assets in the form of loans receivable as well as significant long term borrowings. Loans receivable and long term borrowings at variable rates expose the Group to cash flow interest rate risk while loans receivable and long term borrowings at fixed rates expose the Group to fair value interest rate risk.

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(a) Market risk (continued)

(iii) Cash flow and fair value interest rate risk (continued)

Differences in contractual re-pricing or maturity dates and changes in interest rates expose the Group to interest rate risk. The Group’s exposure to interest rate risks on its financial assets and liabilities are disclosed in Notes 11 and 19, respectively.

The Group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions and alternative financing. Based on these scenarios, the Group calculates the impact on profit and loss of a defined interest rate shift. For each simulation, the same interest rate shift is used for all currencies. The scenarios are run only for liabilities that represent the major interest-bearing positions.

At December 31st, 2007, if interest rates on United States dollars denominated borrowings had been 4.3% higher with all other variables held constant, post-tax loss for the year would have been $1,216,878 higher (2006: post-tax profit would have been $3,240,884 lower), mainly as a result of higher interest expense on floating rate borrowings. At December 31st, 2007, if interest rates on Euro denominated interest bearing assets and borrowings had been 4.3% higher with all other variables held constant, post-tax loss for the year would have been $150,006 lower (2006: post-tax profit would have been $325,437 lower), mainly as a result of lower interest expense and higher interest income on floating rate loans and receivables.

(b) Credit risk

Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial institutions as well as credit exposures to wholesale and retail customers including outstanding receivables and committed transactions.

The Group has no significant concentrations of credit risk. It has policies in place to ensure that wholesale sales of products are made to customers with an appropriate credit history. Sales to retail customers are made in cash or via major credit or debit cards.

For the purposes of credit risk assessment, customers are segregated into categories and reviews take account of the specific trading relationship of each category of debtor with the Company. Credit risk assessment presents significant implications for two major categories of debtors: Trade receivables and Related party receivables.

Trade receivables – Management assesses the creditworthiness of major trade customers on an ongoing basis and revises credit limits based on the findings of analyses performed. Discretionary allowances are made for individual customers where temporary breaches in credit limits are deemed acceptable. This is usually the case at the year end when credit terms are adjusted for preferred customers who trade in high volumes.

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(b) Credit risk (continued)

Related party receivables – Significant related parties do not have credit limits. Transactions undertaken with related parties are tracked during the year to ensure agreement of balances by relevant parties. Related party receivables represent the most significant portion of loans and receivables and at the balance sheet date were all considered collectible.

The table below shows the carrying values at the balance sheet date of major categories of debtors.

2007 2006 $’000 $’000

Trade receivables: Third party trade receivables (Note 15) 188,751 162,417Related party trade receivables 33,038 8,188 221,789 170,605

Related party receivables 357,482 486,972

Aside from instances as those described above, no credit limits were exceeded during the year and management does not expect any losses from non-performance of trade or related party debtors.

(c) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities. Due to the dynamic nature of the underlying businesses, the Group aims to maintain flexibility in funding by keeping committed credit lines available.

3.2 Fair value estimation

The fair value of financial instruments traded in active markets (such as held-for-sale and available-for-sale securities) is based on quoted market prices at the balance sheet date. The quoted market price used for financial assets held by the Group is the market closing price.

The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. Estimated discounted cash flows are used to determine the fair value of long term receivables and long term debt.



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3.2 Fair value estimation (continued)

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

3.3 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 for 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 adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ‘current and non-current borrowings’ as shown in the consolidated balance sheet) less cash at bank and in hand. Total capital is calculated as ‘equity’ as shown in the consolidated balance sheet plus net debt.

The gearing ratios at December 31st, 2007 and 2006 were as follows:

2007 2006 $’000 $’000

Total borrowings (Note 19) 818,887 1,723,291Less: Cash at bank and in hand (Note 16) (22,299) (105,162)Net debt 796,588 1,618,129Total equity 1,195,991 1,300,518Total capital 1,992,579 2,918,647

Gearing ratio 40% 55%

4 critical accounting estimates and judgements

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.



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4 critical accounting estimates and judgements (continued)

4.1 Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. 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 discussed below.

(a) Estimated impairment of goodwill

The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated in Note 2.6(a). The recoverable amounts of cash-generating units have been determined based on fair value calculations. These calculations require the use of estimates (Note 7).

(b) Income taxes

The Group is subject to income taxes in several jurisdictions. Significant judgement is required in determining the worldwide provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

(c) Fair value of derivatives and other financial instruments

Fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. The Group uses its judgment to select a variety of methods and make assumptions that are mainly based on market conditions existing at each balance sheet date. The Group has used discounted cash flow analysis for various available-for-sale financial assets that are not traded in active markets.

(d) Revenue recognition

The Group uses the percentage-of-completion method in accounting for its fixed-price contracts to deliver services. Use of the percentage-of-completion method requires the Group to estimate the services performed to date as a proportion of the total services to be performed.

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4 critical accounting estimates and judgements (continued)

4.2 Critical accounting judgments in applying the Group’s accounting policies

(a) Impairment of available-for-sale financial assets

The Group follows the guidance of IAS 39 (revised 2003) in determining when an investment is other-than-temporarily impaired. This determination requires significant judgement. In making this judgement, the Group evaluates, among other factors, the duration and extent to which the fair value of an investment is less than its cost; and the financial health of and near-term business outlook for the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow.

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5. segment information

Primary reporting format – business segments

At December 31st, 2007, the Group is organised into three main business segments: (1) Manufacture and sale of alcoholic products on a wholesale and retail basis; (2) Manufacture and sale of sauces and seasonings products on a wholesale and retail basis; and (3) Manufacture of fuel ethanol.

The segment results for the year ended December 31st, 2007 are as follows:

Alcoholic Food Fuel Other Group Products Products Ethanol Total 2007 2007 2007 2007 2007 $’000 $’000 $’000 $’000 $’000 Sales 539,673 75,707 61,309 2,695 679,384 Operating profit/segment result 48,528 (2,075) 14,680 (1,575) 59,558Finance costs (Note 25) (242,545)Finance income (Note 26) 39,212Other income (Note 27) 93,734Fair value losses (Note 28) (63,829)Share of results of joint venture before tax (Note 9) - - - (18,682) (18,682)Profit before taxation (132,552)Taxation charge (4,826)Loss for the year (137,378) Segment assets 1,606,946 49,306 - 142,759 1,799,011Unallocated 520,812Total assets 2,319,823 Segment liabilities 282,241 4,613 - 2,614 289,468Unallocated 834,364Total liabilities 1,123,832 Capital expenditure (Note 6) 6,990 9,814 - 2,449 19,253Depreciation (Note 6) 13,666 1,862 - - 15,528Amortisation and impairment (Note 7) 91 482 - - 573



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5. segment information (continued)

Primary reporting format – business segments (continued)

The segment results for the year ended December 31st, 2006 are as follows:

Alcoholic Food Fuel Other Group Products Products Ethanol Total 2006 2006 2006 2006 2006 $’000 $’000 $’000 $’000 $’000 Sales 445,959 71,240 158,730 7,044 682,973 Operating (loss)/segment result 6,683 (38,715) (1,414) 3,081 (30,365)Finance costs (Note 25) (248,354)Finance income (Note 26) 66,704Other income (Note 27) 179,018Fair value gains (Note 28) 203,514Share of results of associate and joint ventures before tax (Notes 8 & 9) 2,747 - - 18,691 21,438Profit before taxation 191,955Taxation charge (4,106)Profit for the year 187,849 Segment assets 1,085,633 51,305 134,685 145,873 1,417,496Joint venture (Note 9) 18,682Unallocated 2,092,209Total assets 3,528,387 Segment liabilities 343,388 3,401 13,287 3,222 363,298Unallocated 1,864,571Total liabilities 2,227,869 Capital expenditure (Note 6) 93,498 1,582 369 1,482 96,931Depreciation (Note 6) 13,344 1,729 8,767 - 23,840Amortisation and impairment (Note 7) 82 39,539 - - 39,621

Inter-segment transfers or transactions are entered into under the normal commercial terms and conditions that would also be available to unrelated third parties.

Segment assets consist primarily of property, plant and equipment, intangible assets, inventories, receivables and operating cash. They exclude deferred taxation and investments.

Segment liabilities comprise operating liabilities and exclude items such as taxation and corporate borrowings. Capital expenditure comprises additions to property, plant and equipment and includes additions resulting from acquisitions through business combinations.

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5. segment information (continued)

Secondary reporting format – geographical segments

The Group’s three business segments operate in two main geographical areas, even though they are managed on a worldwide basis.

The home country of the Company – which is also the main operating country – is the Republic of Trinidad and Tobago. The areas of operation are principally the manufacturing and sale of alcoholic and food products, and fuel ethanol.

Sales Total Capital Asets Expenditure 2007 2006 2007 2006 2007 2006 $’000 $’000 $’000 $’000 $’000 $’000

Trinidad and Tobago 556,882 577,964 1,655,322 1,284,339 8,070 61,687Overseas 122,502 105,009 143,689 133,157 11,183 35,244 679,384 682,973 1,799,011 1,417,496 19,253 96,931

Associates and joint ventures - 18,682

Unallocated 520,812 2,092,209 2,319,823 3,528,387

2007 2006 $’000 $’000

Analysis of sales by category Sales of goods 659,610 652,460Revenue from services 19,774 30,513

679,384 682,973

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6. property, plant and equipment

Plant, Land and machinery Assets buildings and equipment in progress Total $’000 $’000 $’000 $’000

At January 1st, 2006 Cost or valuation 213,561 319,339 166,087 698,987Accumulated depreciation (10,750) (154,702) - (165,452)

Net book amount 202,811 164,637 166,087 533,535

Year ended December 31st, 2006 Opening net book amount 202,811 164,637 166,087 533,535Additions 78,406 18,001 524 96,931Transfers 4,181 5,516 (9,697) -Disposals (896) (1,621) - (2,517)Depreciation charge (3,180) (20,660) - (23,840)

Closing net book amount 281,322 165,873 156,914 604,109 At December 31st, 2006 Cost or valuation 293,948 339,986 156,914 790,848Accumulated depreciation (12,626) (174,113) - (186,739)

Net book amount 281,322 165,873 156,914 604,109 Year ended December 31st, 2007 Opening net book amount 281,322 165,873 156,914 604,109Disposal of subsidiary (3,243) (78,012) (105) (81,360)Additions 10,886 7,267 1,100 19,253Transfers 152 - (152) -Disposals - (1,102) (1,230) (2,332)Depreciation charge (4,764) (10,764) - (15,528)

Closing net book amount 284,353 83,262 156,527 524,142 At December 31st, 2007 Cost or valuation 301,654 251,912 156,527 710,093Accumulated depreciation (17,301) (168,650) - (185,951)

Net book amount 284,353 83,262 156,527 524,142



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6. property, plant and equipment (continued)

The Group’s land and buildings were last revalued on December 31st, 2004 by the directors of the Company. Valuations were made on the basis of market value. The revaluation surplus was credited to other reserves in shareholders’ equity (Note 18).

No borrowing costs were capitalised on assets in progress during the year 2007.

Property, plant and equipment with a book value of $394,639,443 (2006: $367,158,972) are pledged as security for borrowings.

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7. Intangible assets

Goodwill Trademarks Other * Total $’000 $’000 $’000 $’000

At January 1st, 2006 Cost 47,980 400 2,886 51,266Accumulated amortisation and impairment (8,545) (240) (2,382) (11,167)

Net book amount 39,435 160 504 40,099

Year ended December 31st, 2006 Opening net book amount 39,435 160 504 40,099Additions - 273 82 355Amortisation and impairment charge (39,435) (82) (104) (39,621)

Closing net book amount - 351 482 833 At December 31st, 2006 Cost 47,980 673 2,968 51,621Accumulated amortisation and impairment (47,980) (322) (2,486) (50,788)

Net book amount - 351 482 833 Year ended December 31st, 2007 Opening net book amount - 351 482 833Addition - 26 - 26Amortisation and impairment charge - (91) (482) (573)

Closing net book amount - 286 - 286

At December 31st, 2007 Cost 47,980 699 2,978 51,657Accumulated amortisation and impairment (47,980) (413) (2,978) (51,371)

Net book amount - 286 - 286

* Other intangible assets include debt issuance costs and package design costs in one of the Group’s subsidiaries.

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7. Intangible assets (continued)

Impairment tests for goodwill

Goodwill is allocated to the Group’s cash-generating units (CGUs) identified according to country of operation and business segment. The recoverable amount of a CGU is determined based on fair value calculations using best estimates of market multiples of revenue and earnings before interest, taxes and depreciation.

For the year ended December 31st, 2006, management determined the goodwill of one of the Group’s wholly owned subsidiaries to be fully impaired. The primary factors underlying this determination were a significant decrease in net sales during 2006 and corresponding reduction of cash flows and a lowering of forecasted revenues in 2007 and beyond, reflecting 2006 actual results as well as recognition of the increasing competitiveness of the relevant industry. Thus, an impairment loss of $39,435,006 was recognised and included in administrative expenses in the 2006 income statement.

8. Investment in associate

2007 2006 $’000 $’000

Balance at January 1st - 14,834Share of profit - 1,705Disposal of investment in associate - (16,539)Balance at December 31st - -

9. Investment in joint venture

Company Country of incorporation Percentage OwnedTobago Plantations Limited Trinidad and Tobago 50%

2007 2006 $’000 $’000

Balance at January 1st 18,682 2,783Share of (loss)/profit (18,682) 19,658Disposal of investment in joint venture - (3,759)Balance at December 31st - 18,682

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9. Investment in joint venture (continued)

The Group’s share of the results of its joint venture partner which is unlisted, and its share of the assets (including goodwill) and liabilities are as follows:

Assets Liabilites Revenues Profit/(Loss) $’000 $’000 $’000 $’000

2006 114,737 71,517 68,815 18,682 2007 86,813 67,804 8,251 (18,682)

10. available-for-sale financial assets

2007 2006 $’000 $’000

Balance at January 1st 4,975 132,934Additions 90,649 -Reclassified to Held-for-sale (Note 13) - (87,094)Disposals - (236)Adjustments - (41,156)Revaluation surplus 43,361 527

Balance at December 31st 138,985 4,975

Available-for-sale financial assets include the following:

Listed securities:•Equitysecurities–TrinidadandTobago 3,678 4,286•Equitysecurities–EnglishspeakingCaribbean 134,623 5

Unlisted securities 684 684 138,985 4,975

There were no impairment provisions on available-for-sale financial assets in 2007 or 2006.

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11. loans receivable

2007 2006 $’000 $’000

Unsecured loan notes to related company bearing interest at101⁄2%perannumpayablesemi-annually.Principal repayments commenced in June 2007. 202,644 361,995Unsecured loan to joint venture bearing interest at 8% per annum, with no fixed repayment terms. - 901Unsecured loan to related company bearing interest at Euribor (monthly) with no fixed repayment terms. 150,221 118,250Unsecured loan to related company bearing interest at 9% per annum. Principal repayments due from June 2007 to June 2008. - 3,825 352,865 484,971Less current maturities (120,266) (172,275)

Non-current portion (Note 15) 232,599 312,696

Fair values 151,328 244,032

The exposure of the Group’s loans receivable to interest rate changes and the contractual re-pricing dates at the balance sheet date are as follows: 6 months or less 150,221 118,250

12. retirement benefit obligations

The amounts recognised in the balance sheet are determined as follows:

Fair value of plan assets 124,459 113,110Present value of funded obligations (106,429) (95,051) 18,030 18,059Present value of unfunded obligations (1,632) (1,612)Unrecognised actuarial losses 12,563 10,240Asset in the balance sheet 28,961 26,687

The movement for the year in the fair value of plan assets is as follows: Balance at January 1st 113,110 100,754Expected return on plan assets 10,097 9,089Actuarial (losses)/gains (1,722) 924Employer contributions 3,377 2,954Employee contributions 3,377 2,954Benefits paid (3,780) (3,565)Balance at December 31st 124,459 113,110 Actual return on plan assets 8,375 10,013



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12. retirement benefit obligations (continued)

The movement for the year in the defined benefit obligation is as follows: 2007 2006 $’000 $’000

Present value of obligation at January 1st (96,663) (95,293)Interest cost (8,695) (7,198)Current service cost – employer (1,845) (1,728)Current service cost – employee (3,377) (2,954)Severance payments 117 337Benefits paid 3,780 3,565Past service cost (777) -Actuarial (losses)/gains on obligation (601) 6,608

Present value of obligation at December 31st (108,061) (96,663)

The amounts recognised in the income statement are as follows:

Net actuarial loss recognised during the year - (601)Current service cost (1,845) (1,728)Interest cost (8,695) (7,198)Expected return on plan assets 10,097 9,089Past service cost (777) -

Total charge in the income statement (1,220) (438)

The total charge has been included in Administrative expenses in the income statement.

The movement for the year in the asset recognised in the balance sheet is as follows: Balance at January 1st 26,687 23,834Total charge in the income statement (1,220) (438)Employer contributions 3,377 2,954Severance payments 117 337


The principal actuarial assumptions used were as follows:Discount rate 8.5% 8.5%Expected return on plan assets 8.5% 8.5%Future salary increases 7.0% 7.0%

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12. retirement benefit obligations (continued)

Assumptions regarding future mortality experience are set based on US Table GAM83.

The average life expectancy in years of a pensioner retiring at age 60 is as follows:

2007 2006 Male 21 21Female 26 26

The plan’s assets are fully invested in a diversified general portfolio fund managed by the carrier, Colonial Life Insurance Company Limited.

Plan assets are comprised as follows: 2007 2006 % %

Equities 59.3 57.0Cash and other short term assets 27.5 30.5Bonds 6.9 6.6Fixed deposits 6.3 5.9

8.9% (2006: 8.5%) of the pension plan assets are invested in the Company’s ordinary shares.

The expected return on plan assets is determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed interest investments are based on gross redemption yields as at the balance sheet date. Expected returns on equity and property investments reflect long term real rates of return experienced in the respective markets.

2007 2006 2005 2004 2003 $’000 $’000 $’000 $’000 $’000 Fair value of plan assets 124,459 113,110 100,754 96,889 79,617

Present value of defined benefit obligation (108,061) (96,663) (95,293) (87,618) (79,866)

Surplus/(deficit) 16,398 16,447 5,461 9,271 (249)

Experience adjustments on plan liabilities 358 1,142 (3,838) (24) 7,792

Experience adjustments on plan assets (1,722) 924 (5,957) 9,552 (135) Expected contributions to post employment benefit plans for the year ending December 31st, 2008 are approximately $3.6 million.

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13. Held-for-sale financial assets

During 2006 the Group acquired a substantial interest in a French international Spirits Group. In December 2006, a significant part of this investment was sold to related parties at a fair value based on market prices.

In 2007, another significant portion of the investment was sold to a related party at a price which was considered reasonable in light of market prices at the time of sale. Fair value gains recognised in 2006 in respect of securities disposed of in 2007, were reversed as a result of the sale. Movements on the investment balance for the year were as follows:

2007 2006 $’000 $’000

Balance at January 1st 1,544,137 -Reclassified from Available-for-sale (Note 10) - 87,094Additions - 2,069,385Disposals (1,081,335) (866,648) Fair value adjustment through income statement (Note 28) (114,621) 254,306

Balance at December 31st 348,181 1,544,137

For Segment Reporting purposes (Note 5) the investment retained by the Group at December 31st 2007 is classified within ‘Unallocated assets’.

There were no impairment provisions on held-for-sale financial assets in 2007 or 2006.

14. Inventories

2007 2006 $’000 $’000

Raw and packaging materials 108,711 84,165Work in progress 76,571 69,617Finished goods 49,405 59,075

234,687 212,857

Included above are inventories totalling $30,127,915 (2006: $39,328,189), which are stated at net realisable value. Inventories pledged as security for borrowings totalled $220,895,612 (2006: $186,974,150).

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15. trade and other receivables

2007 2006 $’000 $’000

Trade receivables 197,126 169,851Less: provision for impairment of receivables (8,375) (7,434)Trade receivables – net 188,751 162,417Prepayments 10,121 4,790Receivables from related parties (Note 35) 443,657 329,951Taxation refundable 6,668 8,729Loans receivable (Note 11) 352,865 484,971 1,002,062 990,858Less non-current portion of loans receivable (Note 11) (232,599) (312,696)

Current portion 769,463 678,162

There is no concentration of credit risk with respect to trade receivables, as the Group has a large number of customers, internationally dispersed.

The fair values of trade and other receivables are as follows: Trade receivables 188,751 162,417Prepayments 10,121 4,790Receivables from related parties (Note 35) 443,657 329,951Taxation refundable 6,668 8,729Loans to related parties 120,266 172,275

769,463 678,162 The fair values of loans to related parties are estimated by discounting future expected cash flows at the current market interest rates that are available to the Group for similar financial instruments.

The effective interest rates on non-current receivables were as follows: 2007 2006 Loans receivable (Note 11) 4.7-10.1% 5.5-25%

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15. trade and other receivables (continued)

Trade receivables that are less than six months past due are not considered impaired. As of December 31st, 2007, trade receivables of $70,340,209 (2006: $26,704,764) were past due but not impaired. These relate to a number of third party customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:

2007 2006 $’000 $’000

2 to 4 months 20,371 1,562Greater than 4 months 49,969 25,142

70,340 26,704

As of December 31st, 2007, trade receivables of $8,375,048 (2006:$7,434,163) were impaired and provided for. The impaired receivables mainly relate to wholesalers and retailers which have defaulted on payments. The ageing of these receivables is as follows:

Greater than 4 months 8,375 7,434

The carrying amounts of the Group’s trade and other receivables are denominated in the following currencies: Canadian dollar 2,798 2,150Euro 5,336 897Pound sterling 5,653 130Trinidad and Tobago dollar 660,209 617,236United States dollar 95,467 57,749

769,463 678,162

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15. trade and other receivables (continued)

Movements in the Group provision for impaired receivables are as follows:

2007 2006 $’000 $’000

At January 1st 7,434 6,181Provision for receivables impairment 941 1,253

At December 31st 8,375 7,434

The creation and release of provision for impaired receivables have been included in ‘Selling and marketing costs’ in the income statement. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash.

The other classes within trade and other receivables do not contain 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

Cash at bank and in hand 22,299 105,162

Cash, cash equivalents and bank overdrafts include the following for the purposes of the cash flow statement:

Cash at bank and in hand 22,299 105,162Bank overdrafts (Note 19) (29,866) (15,090)

(7,567) 90,072

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17. share capital

2007 2006

Number of shares in issue (000) 206,277 206,277Treasury shares (000) (457) (457)

205,820 205,820 Ordinary shares ($’000) 119,369 119,369Treasury shares ($’000) (811) (811)

118,558 118,558

Share options

Under the share option plan for employees approved by the shareholders at the annual general meeting on April 12th, 2000, the Company granted options to management and employees with ten or more years of service to subscribe for up to a total of 25,000,000 ordinary shares. Options were granted at a fixed price of $5.75 per share, to be exercised in two phases. The first of these phases was from January 1st, 2005 to June 30th, 2005 and the second from January 1st, 2006 to June 30th, 2006 but no options were exercised. At December 31st, 2007, there were no options outstanding.

18. other reserves Investment Revaluation revaluation Capital surplus reserve reserves Total $’000 $’000 $’000 $’000 Balance at January 1st, 2006 55,197 3,489 11,333 70,019Depreciation on revalued assets (405) - - (405)Revaluation of investments - 527 - 527Currency translation difference - - (1,213) (1,213)

Balance at December 31st, 2006 54,792 4,016 10,120 68,928 Balance at January 1st, 2007 54,792 4,016 10,120 68,928Depreciation on revalued assets (405) - - (405)Revaluation of investments - 43,361 - 43,361

Balance at December 31st, 2007 54,387 47,377 10,120 111,884



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19. Borrowings 2007 2006 $’000 $’000

Non-current: Debentures and other loans 34,047 552,709Deferred borrowing costs (5,698) (20,719)

28,349 531,990Current: Bank overdrafts (Note 16) 29,866 15,090Unsecured borrowings 572,805 726,301Secured borrowings 69,537 250,680Debentures and other loans 127,698 199,230Deferred borrowing costs (9,368) -

790,538 1,191,301

Total borrowings 818,887 1,723,291

The maturity of non-current borrowings is as follows: Between 1 and 2 years 24,370 128,506Between 2 and 5 years 3,979 403,484

28,349 531,990

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19. Borrowings (continued)

The effective interest rates at the balance sheet date were as follows:

Nature of borrowing 2007 TT$ US$ £ € CAD$

Bank overdrafts 11.8% - - - -Unsecured borrowings 11.1% 10.7% - - 6.5%Secured borrowings - - - 5.6% 6.5%Debentures and other loans 12.1% 8.8% 5.3% - -

Nature of borrowing 2006 TT$ US$ £ € CAD$

Bank overdrafts 11.8% - - - -Unsecured borrowings 12.7% 11.1% - - -Secured borrowings - - - 37.1% 6.2%Debentures and other loans 8.4% 8.4% 3.6% - -

The carrying amounts and fair values of the non-current borrowings are as follows:

Carrying amounts Fair values 2007 2006 2007 2006 $’000 $’000 $’000 $’000

Debentures and other loans 28,349 531,990 31,919 349,270

The fair values are based on cash flows discounted using rates based on the borrowing rates prevailing at the balance sheet date, in the respective countries where the debts exist.The carrying amounts of short-term borrowings approximate their fair value.



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19. Borrowings (continued)

The carrying amounts of the Group’s borrowings are denominated in the following currencies:

2007 2006 $’000 $’000

Euro 325,043 248,282Trinidad and Tobago dollar 302,378 505,798United States dollar 166,116 947,766Pound sterling 19,009 19,009Canadian dollar 6,341 2,436

818,887 1,723,291

The exposure of the Group’s borrowings to interest rate changes and the contractual re-pricing dates at the balance sheet date are as follows: 6 months or less 762,130 1,091,686Between 6 months and 1 year 28,408 99,615Between 1 and 5 years 28,349 531,990

818,887 1,723,291

Debentures and other loans and secured borrowings are secured by charges on certain of the Group’s investments, property, plant and equipment (Note 6) as well as the cash in escrow. The bank overdrafts are unsecured.

The terms of the debentures and other loans include certain standard covenants with which certain subsidiaries have to comply.

Some of the Group’s borrowings are subject to covenant clauses, whereby the Group is required to meet certain key performance indicators.

The Group did not fulfil all ratios as required in the loan agreement for borrowings with a carrying value of $56,552,231 at the balance sheet date.

Due to this breach of covenant clause, the Lender was contractually entitled at the balance sheet date, to request early repayment of the outstanding amount of $56,552,231. The outstanding balance was therefore classified as a current liability at the balance sheet date.

The Lender has not requested early repayment of the loan as of the date when these financial statements were approved by the Board of Directors. The decision to request early repayment of the loan is subject to the review and approval of the Trustees and Bond Holders of the loan.

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20. Deferred taxation

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority.

The gross movement on the deferred tax account is as follows:

2007 2006 $’000 $’000

Balance at January 1st 13,528 12,038Income statement charge (Note 29) 507 1,490


The movement in deferred tax assets and liabilities during the year is as follows:

Charged/ At (credited) At Dec-31-05 to Income Statement Dec-31-06 $’000 $’000 $’000

Deferred tax liabilities Accelerated tax depreciation 26,661 (83) 26,578Pension asset 5,958 713 6,671Other 112 1,426 1,538

32,731 2,056 34,787Deferred tax assets Provisions (381) (182) (563)Tax loss carry forwards (20,312) (384) (20,696)

(20,693) (566) (21,259)

Net deferred tax liability 12,038 1,490 13,528



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20. Deferred taxation (continued)

Charged/ At (credited) At Dec-31-06 to Income Statement Dec-31-07 $’000 $’000 $’000

Deferred tax liabilities Accelerated tax depreciation 26,578 (434) 26,144Pension asset 6,671 569 7,240Other 1,538 (1,426) 112

34,787 (1,291) 33,496

Deferred tax assets Provisions (563) (71) (634)Tax loss carry forwards (20,696) 1,869 (18,827)

(21,259) 1,798 (19,461)

Net deferred tax liability 13,528 507 14,035

Deferred tax assets are recognised for tax loss carry-forwards to the extent that the realisation of the related tax benefit through future taxable profits is probable. The Group did not recognise deferred tax assets of $53,662,131 in respect of losses amounting to $214,648,525 that can be carried forward against future taxable income. The Group has tax losses of $289,956,816 that have not yet been agreed with the Board of Inland Revenue.

21. other non-current liabilities

2007 2006 $’000 $’000

Amounts due to related parties (i) 33,274 128,053Currency swap derivative (ii) 6,804 5,441Retirement benefits 884 965

40,962 134,459

i) The amounts are unsecured, interest free and have no fixed repayment terms.

ii) A subsidiary has established a currency swap instrument in relation to a US$25.0 million bond to take advantage of exchange movements between the United States dollar and Japanese yen. The agreement is for the term of the related bond but provides for earlier withdrawal. Gains and losses are included in finance income (Note 26) and finance costs (Note 25), respectively, and the fair value of the instrument is shown above as a currency swap derivative.

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2007 2006 $’000 $’000

22. trade and other payables Trade payables 193,520 222,578Amounts due to related parties (Note 35) 54,987 6,262

248,507 228,840

23. other financial liabilities Call options at fair value - 127,619

The 2006 balance represented the fair value of call options attached to certain of the Group’s held-for-sale financial assets. There are no such options at December 31st, 2007.

24. operating profit

Included are the following operating income/(expense) items: Amortisation and impairment of intangible assets (Note 7) (573) (39,621)Depreciation (Note 6) (15,528) (23,840)Employee benefits (Note 31) (88,109) (77,297)Fair value (losses)/gains – net (Note 28) (63,829) 203,514Gain on sale of investments 22,230 184,038Operating lease payments (Note 33) (5,013) (5,531)Research and development (2,088) (2,010)Repairs and maintenance (14,738) (15,387)

25. Finance costs

• Bankoverdrafts 4,827 3,413• Debenturesandotherloans 60,465 67,431• Financingcostsamortised 3,884 3,880• Netforeignexchangetransactionlosses 23,872 182• Fairvaluelossoncurrencyswap 396 -• Securedborrowings 28,821 30,700• Unsecuredborrowings 120,280 142,748 242,545 248,354



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2007 2006 $’000 $’000

26. Finance income

• Dividendincome 649 4,019• Fairvaluegainoncurrencyswap(Note21) - 4,134• Interestincome 38,563 58,214• Netforeignexchangetransactiongains - 337 39,212 66,704

27. other income/(expenses)

• Gainondisposalofsubsidiary 62,736 -• Gainondisposalofinterestinassociate - 5,233• Gainondisposalofinterestinjointventure - 5,722• (Loss)/gainondisposalofheld-for-salefinancialassets (38,567) 172,164• Optionfeeinrespectofheld-for-salefinancialassets 76,827 -• Otherexpenses (7,262) (4,101) 93,734 179,018

28. Fair value (losses)/gains - net

Fair value adjustment on held-for-sale financial assets (Note 13) (114,621) 254,306Fair value adjustment on other financial liabilities 50,792 (50,792) (63,829) 203,514

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29. taxation

2007 2006 $’000 $’000

Current charge 4,319 2,541Deferred tax charge (Note 20) 507 1,490 4,826 4,031Associates and joint ventures charge - 75

Total charge 4,826 4,106

The tax on the Group’s (loss)/profit before tax differs from that calculated at the tax rate in Trinidad and Tobago applicable to profits of the consolidated companies as follows:

(Loss)/profit before taxation (132,552) 191,955 Tax charge at statutory rate of 25% (2006 – 25%) (33,138) 47,989Effect of different tax rates in other countries (608) 340Expenses not deductible for tax purposes 72,828 47,727Income not subject to tax (61,171) (109,798)Tax losses not recognised for deferred tax 25,460 15,979Revenue based taxes 1,455 1,869 4,826 4,106



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30. earnings per share

Basic earnings per share is calculated by dividing the net profit attributable to equity holders of the Company by the number of ordinary shares in issue during the year, excluding ordinary shares purchased by the Company and held as treasury shares (Note 17).

2007 2006

(Loss)/profit attributable to equity holders of the Company ($’000) (137,510) 187,752 Number of ordinary shares in issue (000) (Note 17) 205,820 205,820 Basic earnings per share ($) (0.67) 0.91

Diluted earnings per share ($) (0.67) 0.91

31. employee benefit expense 2007 2006 $’000 $’000

Wages, salaries and other benefits 84,965 75,089Social security costs 718 652Pension costs – defined contribution plans 1,206 1,118Pension costs – defined benefit plans (Note 12) 1,220 438 88,109 77,297 Number of employees as at year end 497 414

32. Dividends per share

The Directors at their meeting on August 16th 2007, declared an interim dividend in respect of 2007 of 5¢ per share. No final dividend has been declared in respect of the year ending December 31st 2007. The total dividend declared in respect of 2006 was 5¢ per share.

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33. leases

The Group has non-cancellable operating leases for vehicles and office space.

2007 2006 $’000 $’000

Expense for the year 5,013 5,531 Future minimum lease payments under these leases at December 31st, 2007 are as follows: Within 1 year 7,310 6,875Between 1 and 5 years 12,889 15,239

20,199 22,114

34. contingent liability

One of the subsidiaries has guaranteed a loan on behalf of the joint venture company. The balance outstanding on the loan at the year end was $1,043,600 (2006:$2,609,000).



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35. related party transactions

The ultimate parent of the Group is CL Financial Limited (incorporated in the Republic of Trinidad and Tobago). The following transactions were carried out with related parties:

2007 2006 $’000 $’000

i) Sales of goods and services Sales of goods: • Parent 2,221 25• Associatesandjointventures - 2,025• Otherrelatedparties 7,908 10,246• Keymanagement 16 -

10,145 12,296Interest and other income: • Associatesandjointventures 162 1,117• Otherrelatedparties 26,916 43,424

27,078 44,541

Assets sold to Parent 1,042,768 1,038,811 1,079,991 1,095,648ii) Purchases of goods and services Purchases of goods: • Associatesandjointventures - 3,170• Otherrelatedparties 12,796 1,299

12,796 4,469Purchases of services and interest charges: • Parent 13,216 -• Otherrelatedparties 122,142 140,136

135,358 140,136 148,154 144,605

iii) Key management compensation Salaries and other short-term employee benefits 9,932 9,522Pension contributions 936 936

10,868 10,458

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35. related party transactions (continued)

2007 2006 $’000 $’000

iv) Year-end balances arising from sales/purchases of goods/services (Note 15)

Current receivables from related parties • Parent 403,490 157,426• Otherrelatedparties 33,509 166,533• Keymanagement 4,658 3,992• Loantodirector 2,000 2,000 443,657 329,951

The loan is interest-free and is repayable within two years of the director’s separation from the company. It is secured by a first charge on property owned by the director.

Loans to related parties (Note 11) i) Non-current portion • Associatesandjointventures - 901• Otherrelatedparties 232,599 311,795

232,599 312,696

ii) Current portion • Otherrelatedparties 120,266 172,275 352,865 484,971

Payables to related parties (Note 22) • Parent 32,454 -• Otherrelatedparties 22,533 6,262 54,987 6,262



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36. sale of subsidiary

During the year, the Group disposed of its Ethanol producing subsidiary to a related party. At the year end, a balance of $5,328,971 was receivable in respect of the disposal. Results on the disposal were as follows:

2007 2006 $’000 $’000

Net assets disposed 111,387 -Gain on disposal 62,736 -

Revenue on disposal 174,123 -

Total assets disposed comprised the following:

Cash 7,226 -Property, plant and equipment (Note 6) 81,360 -

Other assets 46,099 - 134,685 -

37. events after the balance sheet date

(i) Intended disposal of investments Subsequent to the balance sheet date, the Group has engaged in negotiations to dispose of one of its wholly owned subsidiaries as well as its joint venture investment. Both entities operate in industries considered non-core to the Group.

(ii) Acquisition of significant equity investmentOn December 17th, 2007, the Group made a public offer (the Offer) for shares carrying 49.24% of the voting rights in Lascelles de Mercado & Company Limited (the Company), which is listed on the Jamaican Stock Exchange. At the close of the offer on January 28th, 2008, the total acceptances received amounted to 68,636,224 shares which represented 38.90% of the voting rights and for which payments totalling $1,933,327,999 ($4.50 United States dollars per share) were made on February 7th, 2008. This amount represented an initial 50% payment against the full value of the purchase price.

The Group has until January 28th, 2011 to complete the purchase by making final payment per share of between $4.50 United States dollars and $6.15 United States dollars, depending on the actual date of settlement. In accordance with the terms of the Offer, upon completion of the purchase on or before January 28th, 2011, the Group will obtain an additional block of shares in the Company, representing 46.62% of the voting rights, at a total cost of $2 Jamaican dollars.

The majority of funding for the purchase is being provided by the CL Financial Group and shares will be allocated among group members in proportion to their funding contributions. The Angostura Group is expected to hold no more than 20% of the shares of the Company upon final completion of the transaction.

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2007 2006 2005 2004 2003

Gross sales 817,933 816,818 1,490,933 1,304,202 1,350,874

(Loss)/profit before taxation (132,552) 191,955 352,475 39,859 58,077

(Loss)/profit attributable

to shareholders (137,510) 187,752 371,346 59,126 63,661

Dividends 10,314 24,708 24,697 24,715 22,648

Share capital 118,558 118,558 118,558 118,558 118,558

Shares in issue (000) 205,820 205,820 205,820 205,820 205,820

Total equity 1,195,991 1,300,518 1,138,244 748,234 678,785

Total assets 2,319,823 3,528,387 2,477,140 2,393,164 2,354,190

Return on total equity (%) (11.5) 14.4 32.6 7.9 9.4

Return on total assets (%) (5.9) 5.3 15.0 2.5 2.7

Earnings per share (¢) (67) 91 180 29 31

Dividend per share (¢) 5 12 12 12 12

Dividend cover (13.4) 7.6 15.0 2.4 2.6

Share price December 31st ($) 5.11 4.50 5.76 5.00 4.25

Dividend yield (%) 1.0 2.7 2.1 2.4 2.8

Price/Earnings ratio (7.6) 4.9 3.2 17.2 13.7

Five Year review: 2003 - 2007(Amounts expressed in thousands of Trinidad and Tobago dollars unless otherwise stated)

s u p p l e m e n t A r y i n f o r m A t i o nS u p p l e m e n t a r y i n f o r m a t i o n

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m A n A g e m e n t p r o x y C i r C u l A rM a n a g e M e n t P r o x y C i r C u l a r

Republic of Trinidad and TobagoThe Companies Act, 1995(Section 144)

1. Name of Company: ANGOSTURA HOLDINGS LIMITED. Company No. A-719(C).

2. Particulars of Meeting: Twenty-sixth Annual Meeting of the Company to be held on Wednesday, May 28th, 2008 at 10.00 a.m. at the House of Angostura, Angostura Complex, Eastern Main Road, Laventille, Trinidad.

3. Solicitation: It is intended to vote the Proxy solicited hereby (unless the Shareholder directs otherwise) in favour of all resolutions specified therein.

4. Any Director’s statement submitted pursuant to Section 76 (2): No statement has been received from any Director pursuant to Section 76 (2) of the Companies Act, 1995.

5. Any Auditor’s statement submitted pursuant to Section 171 (1): No statement has been received from the Auditors of the Company pursuant to Section 171 (1) of the Companies Act, 1995.

6. Any Shareholder’s proposal submitted pursuant to Sections 116 (a) and 117 (2): No statement has been received from any Shareholder pursuant to Sections 116 (a) and 117 (2) of the Companies Act, 1995.

Date Name and Title Signature April 10th, 2008 Kirk Nancoo Secretary

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I/We the undersigned, being a shareholder(s) of Angostura Holdings Limited, hereby appoint

.............................................................................. of .....................................................................................

. or failing him/her,

the Chairman of the meeting, as my proxy to vote for me and on my behalf at the Annual General Meeting of the Company, to be held on Wednesday, May 28th, 2008, at 10 am and any adjournment thereof.

Ordinary Business For Against

Resolution 1: To receive and consider the Report of the Directors, the Audited Financial Statements of the Company for the financial year ended December 31st, 2007 together with the report of the Auditors thereon. Resolution 2: To re-elect the following Directors who retire in accordance with paragraph 4.6.1 of Bye-Law No.1 of the Company: Mr. Louis A. Monteil Mr. Nicholas K. Inniss

Resolution 3: That Mr. Fraser J. Thornton, who was appointed to the Board since the last Annual Meeting, be and is hereby elected as a Director of the Company for a term until the close of the third Annual Meeting of the company following his election or until his retirement in accordance with paragraph 4.6.2 of the Bye-Law No.1 of the Company.

Resolution 4: To appoint Messrs. PricewaterhouseCoopers, Auditors of the Company and to authorise the Directors to fix their remuneration.

Signed this ................................................. day of ..................................................... 2008 Signed: ..............................................................................................................................................................

Name: ............................................... Address: ................................................................................................

Notes:

1. Proxies should be deposited at the registered office of the Company not less than forty eight (48) hours before the meeting.

2. In the case of a corporation, this proxy should be under its common seal or under the hand of an officer or attorney so authorised on that behalf.

3. In the case of joint holders, the signature of any one of them will suffice.

ANGOSTURA HOLDINGS LIMITEDCompany No.: A-719 (C)

P r o x y F o r mP r o x y F o r m

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