Annual Report and Accounts 2002
Associated 
British Foods plc
Associated British Foods plc Annual Report and Accounts 2002 Garﬁeld Howard Weston
Born 28 April 1927; Died 15 February 2002
‘… the quality, both in skill and integrity, of a
nation’s business community is of paramount
importance to the aspirations, well-being and
standard of living of its people.’ Garry Weston 1991 Annual Report and Accounts 2002 1
Associated British Foods is an international
food, ingredients and retail group with annual
sales of £4.5 billion and 35,000 employees. 
The group is one of Europe’s largest food
companies and has significant businesses 
in Australia, New Zealand, Asia and the US.
Group at a glance 2
Chairman’s statement 4
Chief Executive’s review 8
Grocery 10
Ingredients & oils 14
Primary food & agriculture 18
Retail & packaging 22
Australia & New Zealand 26
Finance Director’s report 30
Board of directors 34
Directors’ report 36
Corporate citizenship 38
Corporate governance 40
Remuneration report 42
Directors’ responsibilities 46
Independent auditor’s report 47
Financial statements 48
Accounting policies 53
Notes to the ﬁnancial statements 55
Principal subsidiary undertakings 74
Investments 74
Progress report 75
Notice of meeting 76
Company directory 80
Operating proﬁt up 13% to £395 million
*
•
Group sales up 3% to £4,545 million•
Investment income down from £66 million to £57 million•
Proﬁt before tax up 9% to £430 million•
**
Adjusted earnings per share up 14% to 38.7p•
**
Dividends per share up 12% to 13.25p•
Cash ﬂow from operating activities up £96 million to £523 million
Net cash funds £1,050 million•
* before exceptional items and amortisation of goodwill
** before exceptional items, proﬁt on the sale of ﬁxed assets and amortisation of goodwill 2 Associated British Foods plc
Grocery
Associated British Foods is a major
manufacturer of both branded and private
label grocery products, many of which are
household names.
Bread & crispbreads
Flour, rice & noodles
Speciality teas
Sugar & sweeteners
Group at a glance
Associated British Foods is grouped into five segments. These
are grocery, ingredients & oils, primary food & agriculture, retail 
& packaging and the Australian & New Zealand operations, George
Weston Foods. The group has sales worldwide and manufacturing
operations across Europe, Australia, New Zealand, Asia and the US.
2002 2001
Sales £m 902 858
Operating proﬁt £m 50 37
Proﬁt margin % 5.5 4.3
Return on capital employed % 15.8 11.6
2002 2001
Sales £m 800 711
Operating proﬁt £m 53 42
Proﬁt margin % 6.6 5.9
Return on capital employed % 19.8 15.8
Ingredients & oils
The group has an increasing focus 
on high added value ingredients and
vegetable oils. It produces functional
ingredients from natural products for use 
in the food, foodservice, pharmaceutical
and personal care sectors.
Baking & confectionery ingredients,
enzymes & yeasts
Polyols & antacid ingredients
Vegetable oils, emulsiﬁers, 
sterols & esters Annual Report and Accounts 2002 3
2002 2001
Sales £m 1,761 1,867
Operating proﬁt £m 195 172
Proﬁt margin % 11.1 9.2
Return on capital employed % 24.7 22.4
2002 2001
Sales £m 712 574
Operating proﬁt £m 77 63
Proﬁt margin % 10.8 11.0
Return on capital employed % 22.4 18.6
2002 2001
Sales £m 580 548
Operating proﬁt £m 12 21
Proﬁt margin % 2.1 3.8
Return on capital employed % 5.8 9.7
Primary food & agriculture
Associated British Foods is UK agriculture’s
biggest customer. The group buys more
primary products from British farmers 
than any other, adding value within the
food chain through its sophisticated and
efﬁcient processing facilities to produce
high quality, staple food ingredients such
as ﬂour and sugar.
Animal feeds
Flour milling
Seed processing
Sugar
Retail & packaging
Primark has a winning formula of
providing quality merchandise at
affordable prices. Allied Glass Containers 
is one of Europe’s leading producers 
of premium glass packaging.
Fashion retail
Glass packaging
Australia & New Zealand
George Weston Foods is a major
processor and producer of primary and
branded food products in Australia and
New Zealand.
Biscuits & cakes
Bread 
Flour milling 
Meat & dairy 4 Associated British Foods plc
Chairman’s statement
‘These results, achieved against a background of increasing global
uncertainty and decreasing investor conﬁdence, demonstrate not
only the strength and resilience inherent in our core businesses
but their capacity for producing further growth.’ Annual Report and Accounts 2002 5
In my interim statement I referred to the solid progress which
had been achieved in the first six months of the year and I 
am delighted to report that our operational performance in the
second half has maintained that rate of growth. Operating proﬁt,
before exceptional items and amortisation of goodwill, increased
by £44 million, or 13%, to £395 million. It is particularly noteworthy
that this performance has been achieved against the background
of a global market characterised by excess capacity and declining
consumer conﬁdence.
All divisions, with the exception of Australia, achieved 
double-digit proﬁt increases maintaining the trend established 
in the first half. Primary food & agriculture again produced 
strong profit growth. Despite a smaller UK beet crop, British
Sugar achieved a satisfactory increase in profit. This could 
not have been achieved without the ongoing rationalisation 
and cost reduction programme which has been a constant focus 
in recent years. Despite an improved operational performance,
our overseas sugar business in Poland was hit by adverse 
market prices resulting in a fall in proﬁt. Although faced with 
a poor wheat harvest, Allied Mills and our arable business
achieved strong gains in proﬁtability. Here again restructuring 
and cost reduction has been a constant theme. In agriculture,
traditionally the most volatile sector of our operations, we were
able to overcome the trailing impact of disease and adverse
weather conditions to record strong gains in our animal feeds
business. Given the continuing problems of pricing, ﬁnancial
instability and over capacity in the farming industry, the
achievement of double-digit growth in a shrinking sector of 
the UK economy is a remarkable result.
With one exception, the ingredients & oils businesses put in 
an outstanding performance. ACH signiﬁcantly increased its 
proﬁt and this is particularly pleasing because it was achieved
before including any contribution from the Mazola oils
acquisition, which was only purchased towards the end of 
the ﬁnancial year. The integration of Mazola is going according 
to plan and it is expected to make a substantial contribution 
to the proﬁt growth of ACH in the coming year. SPI, our polyols
business, has made a recovery from the operational problems
experienced last year and achieved a signiﬁcantly improved
proﬁt. It is disappointing to report that our Abitec ingredients
business faced problems in reorganising and integrating its
existing and newly acquired bakery ingredients businesses 
in the UK and the US. The result was a decline in proﬁt but,
despite this setback, we are confident that growth will be
resumed in the current year.
Our grocery businesses again produced an excellent result.
Allied Bakeries continued to grow branded volume in the
multiple retail sector. With contributions from a bread price
increase, cost reductions and operational efﬁciency improvements,
Allied Bakeries achieved a signiﬁcant improvement in its results.
Twinings maintained its strong performance in worldwide sales,
market share and proﬁt growth. A strong feature in this growth
story in recent years has been the successful development of its
product range into the herbal and fruit infusion markets both 
in the UK and overseas.  
Primark has again achieved outstanding growth in both 
sales and proﬁt. We continue to acquire and develop stores 
in new city centre locations and we are confident that the
growth of this business can be maintained in an increasingly
competitive sector.
The poor performance of George Weston Foods in Australia
continued into the second half of the ﬁnancial year. Despite a highly
successful performance by the milling and baking businesses, 
our meat and biscuit operations continued to underperform. During 
the year we sold, at a proﬁt, our loss-making starch manufacturing
operation. Since the ﬁnancial year end we have completed the
buyout of the minority shareholders in the company. We are now 
in a position to take positive action to best position this business 
for growth. This will be a major focus in the coming year.
The disposal of redundant properties continued resulting in 
a proﬁt of £8 million in the year. 
Despite an increased level of expenditure on ﬁxed assets and
acquisitions at over £450 million, the strong cash ﬂow from our
operating activities ensured that at the year end our net liquid
funds were in excess of £1 billion, a level virtually unchanged 
from the previous year. Improved returns on these invested funds
in the second half of the year enabled us to restrict the decline 
in the level of investment income as a result of lower interest rates.
At £57 million this was £9 million, or 14%, below last year. 6 Associated British Foods plc
Chairman’s statement continued
Adjusting for exceptional items, proﬁts on the sale of ﬁxed assets
and amortisation of goodwill, group proﬁt before tax increased 
by 9% to £430 million. Adjusted earnings per share were 14%
ahead of last year at 38.7p.
Your company is renowned for its defensive strengths and its cash
generating capability. These results, achieved against a background
of increasing global uncertainty and decreasing investor conﬁdence,
demonstrate not only the strength and resilience inherent in our
core businesses but their capacity for producing further growth. 
Management effort continues to be focused on improving 
the efﬁciency of our businesses. This is not only a process of
reducing our cost base but of improving the level of performance
by our operating management both by developing the best 
of our existing executives and targeted recruitment of stronger
managers where required.
Spending on acquisitions in the year totalled £268 million
including £235 million for the purchase of Mazola in the US.
This bottled corn oil business is an ideal ﬁt with ACH oils and
enables us to broaden our product offering into the branded
retail segment of the market as well as to rationalise production
and distribution costs. This acquisition will have a positive impact 
on earnings in our 2003 ﬁnancial year. 
Since the end of the ﬁnancial year we completed the purchase of
the minority shareholdings in George Weston Foods in Australia at
a cost of £58 million. In early October we announced the purchase
of Ovaltine, the branded malted drinks business, from Novartis of
Switzerland for a consideration of £171 million. The acquisition
includes Ovaltine and associated brands throughout the world
except the US. The addition of this internationally known brand to
our product portfolio will enhance our presence in the international
consumer market for hot beverages. This acquisition is forecast to
be earnings enhancing in its ﬁrst year under our ownership.
In my last annual report I stated that the outlook for the year
ahead was one of escalating uncertainty and of reduction in
consumer conﬁdence. Financial markets throughout the world
over the past year have reﬂected that in moving consistently
lower. I believe that the coming months will bring little in the 
way of relief from these pressures as the global economy faces
up to the possibility of war in the Middle East, a seemingly
unending ﬁnancial crisis in Japan and low to zero growth in the 
US and Europe. No company as large and widespread in its
activities as ours can be totally immune from these inﬂuences.
Despite this gloomy outlook I believe that this company can face
the coming year with the conﬁdence that it will maintain its positive
growth in sales and operating proﬁt. In the past year, we have
invested over £450 million on acquisitions and capital expenditure
in our existing businesses. Such is the strength of our cash ﬂow
that we have ﬁnanced all this without any signiﬁcant reduction in
the level of our net liquid funds. These investments and the further
acquisitions since our year end will have a positive effect on our
operating performance in the coming year.
The growth of your company has been ﬁnanced from its own
resources. The value of this long-held and important discipline 
is clearly demonstrated in today’s hostile ﬁnancial environment
where the very existence of many companies is threatened by
their inability to service debt taken on in more expansionary times.
Our objective is to grow at a steady and sustainable pace funding
our development from cash ﬂow and a strong balance sheet. 
The base of our business has been signiﬁcantly reshaped in the
past three years. We have sought to eliminate areas of weakness
or irrelevance to our planned growth but at the same time we
have sought to strengthen and expand those sectors which can
act as the framework for our future development. I am conﬁdent
that your company can maintain its current momentum. 
Board changes
The appointment of Mike Alexander as an additional non-executive
director was announced in January this year. Mr Alexander is
executive director and chief operating officer of Centrica plc,
having previously held a number of management positions with
BP and latterly with British Gas. He brings a wealth of operational
management experience and will make a strong contribution to
our activities.
Dividends 
The directors have declared a second interim dividend of 9.00p
(2001 – 7.55p) which will be paid on 18 February 2003 to
shareholders registered at the close of business on 17 January 2003. Annual Report and Accounts 2002 7
This makes a total dividend for the year of 13.25p, an increase 
of 12% on the previous year.
Employees 
The pace of change in our organisation owes much to our 
employees around the world who have not only risen to the
challenges this poses but have made major contributions in taking 
us forward. The successes we are recording in this report are a
testament to their efforts and I take this opportunity to thank them all.
Chairman 
Your company is well placed to achieve further growth. It has an
excellent management team and a solid ﬁnancial base.
Having served as a director for the last 23 years I feel that it is the
appropriate time to step down and I have notiﬁed the board that 
I intend to retire immediately following the annual general meeting.
My successor as Chairman will be Martin Adamson, a fellow board
member who will bring to the role a wealth of business experience
and a breadth of knowledge of your company’s activities. I wish
him and my colleagues every success in the years ahead.
Harry Bailey  
Chairman
‘The growth of your company has been ﬁnanced from its own
resources... Our objective is to grow at a steady and sustainable
pace funding our development from cash ﬂow and a strong
balance sheet.’ 8 Associated British Foods plc
Chief Executive’s review
Businesses across the group again delivered excellent results,
increasing operating proﬁt, before exceptional items and
amortisation of goodwill, by 13% to £395 million and increasing
group sales by 3% to £4,545 million. Adjusted earnings per
share rose by 14% to 38.7p. 
A particularly pleasing aspect of these results is that, for the
second year running, four out of ﬁve of the business categories
outlined in our segmental analysis delivered operating proﬁt
increases in excess of 10%, a clear indication of the breadth 
of progress being made across the group.
Delivering sustained growth is however only one of our goals. 
The other major goal is the generation of strong cash ﬂow, the
means by which we will ensure our ongoing ability to invest heavily
in the capital projects and acquisitions necessary to underpin
future earnings growth. The cash ﬂow generated by the group over
the last year, after capital expenditure but before acquisitions and
disposals, was £229 million. This result demonstrates the strong
cash generating ability of the group.
Although our shareholders and our employees should take 
some satisfaction from these ﬁnancial results there have also
been other signs of progress. Good market positions have 
been strengthened, strong management teams have been
reinforced and a more international company is emerging 
with the ﬁrst rate new businesses acquired in North America,
Europe and Asia.
There is however much still to do in order to bring the company
closer to achieving its full potential. We need to do even more 
to develop our management teams and we must further increase
the focus we place on the marketing of our products. We must
also continue to review the performance and plans of all our
businesses to determine those where we can achieve the best
returns on our investment.
A key element of our future is the further development, either
organically or by acquisition, of very strong market positions 
that have the scale, cost base and breadth and depth of product
offering necessary to make a major impact on their markets. 
We still have a place for efﬁcient, smaller businesses with the
potential to grow, but the development of larger scale positions
will strengthen the base of our business and provide the platform
for signiﬁcant subsequent growth. 
One example of our ability to develop businesses is at ACH.
Here the business has moved, in a two year period, from 
being a medium size refiner, bottler and marketer of private
label cooking oils to becoming a leading player in the bottling
and marketing of oil based food products in North America. In
making this transition we outsourced the inefficient elements 
of our manufacturing operations and, with the acquisition of
strong brands in both foodservice and retailing, created strong
market positions with the scale necessary to optimise our
distribution and buying efficiencies. In time this strength will
inevitably provide further opportunities for significant growth. 
‘Good market positions have
been strengthened, strong
management teams have 
been reinforced and a more
international ABF is emerging
with the first rate new
businesses acquired in North
America, Europe and Asia.’ Annual Report and Accounts 2002 9
In a similar way we are looking to the recent acquisition of the
Ovaltine brands from Novartis to work alongside our already
successful Twinings business to give the scale, expertise and
international market presence necessary to have a much stronger
impact on the speciality beverages market. This will again provide
a base for further growth.
Many of our businesses can however achieve the necessary strength
and scale in their markets without major acquisition but by organic
growth supported by capital investment. During the past year 
£186 million was invested in capital projects including £51 million
on new stores and reﬁts in support of the remarkable growth of our
Primark retailing operation. The skill of Primark’s staff, their clarity of
focus and their understanding of the customer have all contributed
to a further strengthening of Primark’s position in its chosen market. 
This last year has seen good performances from a range 
of businesses across the group. Many of these will be referred 
to later in the report. Examples of marketing successes include
brand extensions at Ryvita and Twinings and innovative product
launches at our SPI Pharma business. Amongst the many
examples of effective cost reduction was a very strong performance
in improving supply chain and distribution efﬁciencies at our UK
bakery business. However, this business continues to trade in a
tough market and much work is still needed before we achieve 
a satisfactory level of return from this investment.
References to tough market conditions become repetitive and
should now be seen as the norm for most industries. Many of 
our businesses have shown that success can be achieved in 
the toughest of markets. 
Since the end of the ﬁnancial year we have acquired the minority
shareholdings in George Weston Foods, our Australian 
business. Much has been said about the disappointing levels of
performance from this business in recent times. The problems
have centred on our meat and biscuit operations and should 
not detract from the qualities of the rest of the company which
include a ﬁrst rate milling and baking operation, some very good
brands and some very good people. The change in ownership
structure will allow us to simplify the business and should lead 
to an early improvement in results.
Any overview of our performance would not be complete
without a reference to sugar. British Sugar’s results were
impacted by a low crop, poor performance at the Wissington
factory and, to a lesser extent, by low world sugar prices.
Despite this we delivered a strong result which, although still 
a major part of our earnings, is becoming a smaller proportion 
of the whole as other parts of the business continue to grow.
This reduces the group’s exposure to the EU sugar regime 
which is a trend we expect to continue.
I mentioned above the fluctuations in world sugar prices.
Although they do not have a major direct effect on British Sugar,
they have a major indirect effect on the profitability of our
businesses in Poland and China. Lower sugar prices have
impacted profits from these two businesses during the last 
year and I do not expect to see any improvement in the 
coming year.
Across the board our businesses can face the future with
conﬁdence, aware that there is still much to do, but knowing
from their achievements this year that they have both the ability
and resources to continue on a very ﬁrm growth path.
Peter Jackson  
Chief Executive
1998 1999 2000 2001 2002 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002
4,195
4,299
4,406
4,418
316
326
340
351
32.0
33.1
33.8
38.7
Sales £m Adjusted operating proﬁt £m
before exceptional items 
and amortisation of goodwill
Adjusted earnings per share p
before exceptional items, proﬁt on the sale 
of ﬁxed assets and amortisation of goodwill
31.3
4,545 395 10 Associated British Foods plc
everyone’s cup of tea
Our teas include
Jacksons of Piccadilly,
Nambarrie and the
world’s leading speciality
brand Twinings.
 Annual Report and Accounts 2002 11
Grocery
Associated British Foods is a major manufacturer of both
branded and private label grocery products, many of which 
are household names.
Strong growth was achieved by our grocery businesses with sales up 5% to £902 million
and proﬁt up 35% to £50 million. This represented a good performance by all businesses
except for a lower proﬁt at Speedibake.
Allied Bakeries made good progress in the year. Sales increased with continued volume
growth by the Kingsmill brand and a sales price increase last autumn to recover increases
in ﬂour prices. Kingsmill growth was supported by the launch of Whole & White Rolls early
in the year and increased marketing support. Proﬁtability improved and was supported by
a continuing programme of cost reductions, including the closure of the Shefﬁeld bakery,
and improved production efﬁciencies.
Cost reductions at Allied Bakeries were achieved in distribution, systems and
administration. A much strengthened management team was responsible for increased
investment in the business. This investment was made in improvements to product 
quality, sales force effectiveness, distribution and systems, all of which are expected 
to yield further beneﬁts in the future.
Competitive pressure and increased input costs reduced proﬁtability at Speedibake.
Progress was made in streamlining the business. The Northampton factory was closed
during the year and production was transferred to the other factories at Wakeﬁeld and
Bradford. The business has been restructured to provide a greater focus on innovation
and market development for its five core product streams: French bread, speciality
bread, filled products, muffins and doughnuts. A new innovation centre opened in
Wakeﬁeld, and has already made an important contribution to the ﬂow of new products.
Partnerships with our main customers have worked to stimulate consumer demand for 
in-store bakery products. 
Dating back to 1706, Twinings is one of the oldest tea brands, and is popular in 
more than 100 countries. It continued to make strong progress with increases in sales 
and proﬁt. In the UK, the ﬂagship black and gold speciality tea range was successfully
relaunched in the autumn. There was continued good growth in the herbal and
infusions sectors, and Twinings brands are also now leaders in green tea. Sales of 
iced tea grew strongly, supported by major sampling initiatives and in-store promotions.
Export and international sales now represent nearly 80% of Twinings sales. The US
operation performed particularly well and, in France, the La Tisanière ‘Bien Etre’ range
of herbal products grew substantially.
The acquisition of Ovaltine and associated brands from Novartis was announced 
in October 2002. Ovaltine, or Ovomaltine outside the UK, is a large, growing
international brand with leading market positions in Europe and Asia. The brand
comprises a range of nutritional malt based beverages, snacks and confectionery. 
In addition to Ovaltine, the acquisition includes a number of strong national brands
including positions in coffee and hot chocolate. Ovaltine provides sustained energy 
2002 2001
Sales £m 902 858
Operating proﬁt £m 50 37
Proﬁt margin % 5.5 4.3
Return on capital employed % 15.8 11.6 Our market leading
brand Silver Spoon
continued to add to its
wide range of products
with Crusha, a syrup
based milk shake mix.
The brand adds to 
our existing range 
of sweeteners and ice
cream toppings.
 12 Associated British Foods plc
Grocery continued
The launch of organic
rice cakes by Ryvita 
is the latest product
development from 
a brand established 
in 1925.
 and nutrition beneﬁts which are especially appealing to mothers, young children 
and teenagers. The combination of Ovaltine and Twinings will create a strong 
speciality hot beverage business with international scale. Both businesses will 
be strengthened with wider geographic opportunities, stronger distribution within 
markets and an enhanced international management team. 
Ryvita had another record year. It maintained its volumes and beneﬁted from 
television advertising in the UK to support its brand leading position. Ryvita 
rice cakes were successfully launched in the year and have quickly become 
a brand leader. 
Silver Spoon is the UK’s leading sugar brand, selling nearly one million 1kg 
packs of sugar a day. Market share was gained in the retail sugar market. Good
progress in artiﬁcial sweeteners continued with ‘Nothing Comes Closer to Sugar’ 
which achieved signiﬁcant sales growth and it now has a 10% share of its market. 
The Crusha milk shake syrup business, acquired in December last year, has now 
been fully integrated. Skilled marketing and strong trade relationships have resulted 
in increased listings and effective promotions. Its performance has exceeded all
expectations, showing major volume growth despite the poor summer weather. 
Westmill Foods is a major supplier of rice and ﬂours to supermarkets and specialist
ethnic food stores. Good progress was made this year and its profit increased. 
Rice performed particularly well in the face of strong competition, by regaining lost 
sales from last year and launching Asli basmati rice, which is aimed at the premium
ethnic sector. In retail, branded rice sales increased following the launch by Patak 
of their dry rice. A range of microwaveable rices for the branded and private label
sectors was launched in the spring and early reaction has been extremely favourable.
There was further signiﬁcant growth in the Allinsons breadmaking range.  The refreshing way to a modern lifestyle…
Tea, like Twinings, has been around a long time, but the choice of ﬂavours and variations is greater now
than ever before. People’s tastes are as different today as the lives they lead. Increasing interest in
healthier living is driving our product development programme. Decaffeinated and organic teas, and herbal
and fruit infusions, are rapidly becoming just as popular as our traditional ﬂavours. Green teas are a fast
growing market and ready to drink iced teas have taken us in a new direction again, providing instant
refreshment straight from a carton. It all goes to show that even after 300 years, we can still rise to the
challenge of satisfying – and anticipating – changing preferences.
Annual Report and Accounts 2002 13 Our vegetable oils
business is a leader 
in the North American
branded oil sector. 
The recent acquisition
from Unilever of Mazola
and its associated
brands moves us into 
the leading position in
the US corn oil market.
 a recipe for success
14 Associated British Foods plc Annual Report and Accounts 2002 15
Ingredients & oils
The group has an increasing focus on high added value ingredients
and vegetable oils. It produces functional ingredients from natural
products for use in the food, foodservice, pharmaceutical and
personal care sectors.
Strong growth this year, with sales up 13% to £800 million and proﬁt up 26% to
£53 million, was driven by ACH and SPI which more than offset a decline in Abitec.
ACH Food Companies, our US oils business, made significant progress in the year. 
The sale of the loss-making Greenville, Mississippi rice milling operation was completed
at the end of last year and the business beneﬁted from lower manufacturing costs following
the exit from commodity oil processing at Champaign, Illinois and the rationalisation
of production following the closure of Columbus, Ohio.
The branded foodservice and oils business acquired from Procter & Gamble in
January 2001 has been fully and successfully integrated. Despite the initial negative
effect on the foodservice market after the events of 11 September 2001, this business
achieved higher volumes and profit with new business gained and new product
offerings introduced.
The purchase of the Mazola branded cooking oil and corn products business in the 
US, Canada and Puerto Rico from Unilever was completed in July. The main brands
acquired were Mazola cooking oil, Argo and Kingsford’s cornﬂour, Karo and Golden
Griddle syrups. This acquisition is expected to be fully integrated with ACH’s existing 
oil business by December 2002.
Mazola is a premium brand with a strong loyalty in the trade and with the consumer
and strengthens the retail position of ACH by adding the leading corn oil brand. 
The proﬁt in the next ﬁnancial year will reﬂect the signiﬁcant cost savings arising from
the integration and the benefits of creating stronger channels to market for Mazola. 
The profit contribution from the acquisition in this financial year has been offset by 
the one-time charges for the integration.
There was a strong recovery at SPI, our US-based polyols business. Polyols are 
sugar-free sweeteners derived from carbohydrates which are used in a variety of
applications in the food, confectionery, oral care, cosmetic and industrial markets. 
Sales growth, improvements in product mix towards higher value added products and
cost reductions all contributed to this improvement. In addition, the organisation and
operating processes were strengthened, which will provide further beneﬁt in the future.
In Food, sales rose sharply for the proprietary products based on maltitol which are
targeted at the high growth sugar-free confectionery market in North America. These
products function and taste like sucrose and allow the development of sugar-free
versions of existing products without compromising taste.
In Pharma, following its launch last year, Pharmagum
TM
is meeting expectations and has
been joined this year by Pharmaburst
TM
– a quick-dissolve drug delivery system. Several
pharmaceutical companies have filed for regulatory approvals employing this novel
2002 2001
Sales £m 800 711
Operating proﬁt £m 53 42
Proﬁt margin % 6.6 5.9
Return on capital employed % 19.8 15.8 16 Associated British Foods plc
Ingredients & oils continued
A recent development
from Abitec provides
the paper industry with
an environmentally
friendly alternative 
to chlorine in the
bleaching process.
 method of administration. The business continues to extend its technology base through
partnerships with other suppliers to the pharmaceutical industry. 
Abitec is focused on three business areas: bakery ingredients, lipid technologies and
enzymes. Operational problems were encountered in the reorganisation and integration
of its bakery ingredients businesses, Cereform, in the UK and US and resulted in a
reduction in proﬁt in addition to the charge taken for the rationalisation. The rationalisation
of the acquired SPP business in the UK with our existing business is now complete
and has created the UK leader in the supply of technical bakery ingredients. In the
US the concentration of mixes, icings and fruit fillings activities in Denver has also
been completed. The management focus is now to overcome the operational difﬁculties
and increase the margins and proﬁt of this business.
Lipid technologies delivered a good performance from its sales to the personal care 
and pharmaceutical markets. Following a slowing in the ﬁrst half, the enzymes business
continued its strong progress in the second half to deliver a year of profit growth. 
It continues its focus of developing innovative solutions for customers in sectors as
diverse as animal feeds, beverages and textiles. Environmental applications have also
been devised for paper manufacturers, who use enzymes to reduce the viscosity of
pulp, thus saving energy, and to remove bleach from the whitening process. Annual Report and Accounts 2002 17
A leader in food oils…
Our policy has always been to invest in areas where we have substantial strength and expertise. The
successful integration of the former Procter & Gamble branded foodservice oils business last year showed
how we can quickly absorb, and add value to, the businesses we buy. 
In July we bought Unilever’s North American branded corn oil and corn products business, which
signiﬁcantly strengthened our competitive position in the food oils industry. We are now a leader in the
branded retail sector, with the number one corn oil brand Mazola. Mazola has exceptionally strong
customer loyalty – both from trade and consumers alike. We have also acquired other market leading
names such as Argo and Kingsford’s cornflour, Karo corn syrup and Golden Griddle table syrup.
We were already a leader in own label and branded foodservice oils, as well as own label retail oils. 
This new business, with its premium branded retail products, is a superb ﬁt with our existing portfolio.
With our extensive knowledge of the industry and strong trade relationships, we are conﬁdent of being 
able to exploit the full potential of these brands. We now have the strong presence required in the market
to make the most of our sourcing and distribution activities. In turn, this strength will almost certainly
open up avenues for growth. 
Creating stronger routes to market, making cost savings and providing a greater sales and marketing
focus will ensure that Mazola – and its sister brands – develop in the future.  a taste for life
We are the UK’s leading
sugar supplier.
 18 Associated British Foods plc 2002 2001
Sales £m 1,761 1,867
Operating proﬁt £m 195 172
Proﬁt margin % 11.1 9.2
Return on capital employed % 24.7 22.4
Annual Report and Accounts 2002 19
Primary food & agriculture
Associated British Foods is UK agriculture’s biggest customer. 
The group buys more primary products from British farmers 
than any other, adding value within the food chain through its
sophisticated and efﬁcient processing facilities to produce high
quality, staple food ingredients such as flour and sugar.
Good progress was made by British Sugar, Allied Mills and ABNA. However, proﬁt 
in the Polish sugar business was impacted by a poor crop and lower market prices.
British Sugar beneﬁted in the year from lower costs arising from the rationalisation of 
its factories, better yields from processing and the strengthening of the euro. Following 
the closure of two factories in 2001, there was further rationalisation with Kidderminster
being closed in February 2002 and Allscott being successfully upgraded. These beneﬁts
more than offset the impact of the lower sugar beet crop of only 1.22 million tonnes,
compared to 1.325 million tonnes for the prior year, the processing problems at the
Wissington factory and a fall in world sugar prices which affect the value of sugar
exports. The proﬁt this year included the release of a £7 million provision established
some years ago for a potential ﬁne which is no longer needed following a favourable
judgement by the European Court of Justice.
The £25 million resin separation plant at Wissington was successfully commissioned 
in the spring. This provides an important new revenue stream from the production of
other beet-derived high value products.
Our Chinese sugar business had a good year with sales volumes doubling, beneﬁting
from the acquisition of a fourth factory at Wuxuan in October 2001. However, prices
were lower than the previous year. Political uncertainty, oversupply in the market and 
a poor crop contributed to a disappointing performance by the Polish sugar business.
The process of rationalising the company’s ten factories is well underway, and the objective
of becoming the lowest cost producer of quality sugar remains on track. Lower sugar
prices in Poland and China are expected to continue in the short-term.
The Germain’s Technology Group is a leader in the market for seed treatment and coatings.
The UK and continental European operations delivered good results, but the North American
business experienced difﬁcult conditions with pressures on volumes and markets. The US
sugar beet seed coating business has been restructured, and production is now focused 
at the plant in Fargo, North Dakota, following the closure of the Longmont, Colorado facility. 
Allied Mills had a good year as it benefited from reduced costs. Overheads were 
lower following the closure of two mills last year and the successful centralisation of
administration. Poor weather resulted in the smallest UK wheat harvest since 1988
which in turn triggered increased wheat prices and the ﬁrst ﬂour price increase in ﬁve
years. A new semolina packaging plant and warehouse opened at Tilbury in March. 
ABNA is the group’s agriculture business, comprising grain marketing, animal feeds 
and ‘identity-preserved’ speciality crop production. Across all sectors, UK agriculture
remains under severe economic and price pressures, compounded by the legacy of 
the foot and mouth and BSE crises. Against this difﬁcult background, the business
continued to outperform in its sector.  20 Associated British Foods plc
Primary food & agriculture continued
In the arable sector, low prices have put pressure on farmers who are buying less 
seed. However, ABNA’s arable business grew its share of the seed, fertiliser and grain
markets, despite a signiﬁcantly smaller cereal crop. This success is a direct result of
delivering added value services to farmers and the establishment of long-term marketing
contracts with end-users, farming groups and co-operatives.
The animal feeds business has also grown its market share. Crucial to this has been 
the continuing development of supply chain partnerships, and the implementation 
of a new feed grain procurement policy in partnership with the arable business. New
products introduced during the year included organic sugar beet pulp and pressed
apple pulp, as well as a new feed for enhanced milk production. 
ABNA is now looking to beneﬁt from the integration of its arable and animal feeds
businesses with improved logistics and new systems. When implemented, these are
expected to result in an enhanced service offering to both customers and suppliers. 
Kings is a specialist business devoted to plant-derived oils, which have a wide and
expanding range of applications. These include pharmaceuticals, dietary supplements,
personal care and industrial chemicals. During the year, a new base was established 
in North Carolina, taking advantage of the southern state’s climate to grow speciﬁc, 
high value crops for pharmaceutical companies. An increasing number of customers
are looking for absolute integrity of crops, and with the business focused on identity
preserved production and processing, it has signiﬁcant potential for growth.
Wheat germ oil is one
of the richest natural
sources of Vitamin E
and has a wide range 
of different applications
in health food,
aromatherapy and
cosmetic products. 
We are involved in the
complete supply chain
– from the purchasing
of wheat through Allied
Grain, to the milling 
of wheat by Allied Mills
and, finally, to the
extraction of the oil
by Kings.
 Annual Report and Accounts 2002 21
Far Eastern ventures…
Our involvement with China’s sugar industry
began with a joint venture in 1995. Within
eighteen months the plant’s cane crushing rate
had doubled, thanks to substantial investment 
in factory technology and new working practices.
We now have majority control of four cane
factories in Guangxi province, producing over
350,000 tonnes of sugar a year. Along with 
plant upgrades, an agricultural improvement
programme has doubled the cane growing area
and greatly increased sugar yields. 
Western style ﬁnancial controls and comprehensive
training for management and employees have
greatly enhanced efﬁciencies in this business. 
The beneﬁts of this extend beyond the factories
themselves and into the local economy. Examples
of this include our commitment to supporting
projects such as new employee housing,
educational and nursery facilities. value for money
Targeted at fashion
conscious under 35s,
Primark offers stylish,
quality merchandise at
very competitive prices.
 22 Associated British Foods plc Annual Report and Accounts 2002 23
Retail & packaging
Primark has a winning formula of providing quality merchandise
at affordable prices. Allied Glass Containers is one of Europe’s
leading producers of premium glass packaging.
Primark 
Very strong growth continued at Primark driven by new store openings, particularly 
in the second half of last year, and like-for-like sales growth of 4% over last year. 
Sales increased by 27% to £654 million and profit was up by 20% to £72 million. 
As mentioned in the interim report, operating proﬁt margins were reduced, mainly 
as a result of the overheads arising from the substantial increase in capacity following
the opening of our warehousing facility at Magna Park last year.
Primark is now a major retail group employing nearly 10,000 people and operating 
114 stores in the UK and Ireland (where it trades as Penneys). Targeted at fashion
conscious under 35s, Primark offers stylish, quality merchandise at very competitive
prices in a pleasant shopping environment. The ranges on offer are constantly updated,
and buyers work directly with suppliers to develop and source exclusive products and
negotiate the best prices on high volumes of merchandise. Computerised customs
clearance and dedicated warehousing and distribution services allow stores to maintain
complete control of their stock to support sales. 
Selling price deﬂation is now a factor in many departments in retail textiles reﬂecting
market competition and lower input costs. Primark’s like-for-like sales value increase 
of 4% in this environment demonstrates the strength of its offering.
Six new stores were opened during the year, including the company’s ﬂagship store 
in Manchester in October. In a prime city centre location, it occupies 70,000 square
feet and is the company’s largest store to date. Other stores were opened in Lewisham,
Glasgow, Torquay, Bromley and in Blanchardstown, near Dublin. The existing store in
Wandsworth was relocated. Primark is now trading from almost 2 million square feet 
of retail selling space.
Major refits were started in 11 existing stores, to update the format and to increase
selling space at certain stores. The ﬁrst of these, at Stevenage, has expanded into space
upstairs and has reopened very successfully with sales double those of last year.
Primark is continuing actively to seek additional locations for new stores. Contracts 
have already been signed for new stores in Birmingham, due to open in December, 
East Kilbride and, in the Republic of Ireland, at Dundrum.
Allied Glass Containers
The UK market for glass packaging showed moderate growth with a significant
increase in the premium packaged spirits sector but a substantial decrease in food.
The continued overcapacity in the market resulted in price pressure during the year.
Although volumes at Allied Glass Containers declined in this competitive environment,
cost reductions and an increase in added value sales contributed to an increase 
in profit.
2002 2001
Sales £m 712 574
Operating proﬁt £m 77 63
Proﬁt margin % 10.8 11.0
Return on capital employed % 22.4 18.6 24 Associated British Foods plc
Retail & packaging continued
The reorganisation of production facilities started last year was completed, resulting in
increased use of three larger, more efﬁcient furnaces at Leeds and Knottingley and a
signiﬁcant reduction in operating cost. Capital investment during the year focused on this
reorganisation, and included a replacement bottle forming machine which increased output.
Allied Glass Containers remains focused on short run, high quality packaging. Its
design innovation skills have been recognised through winning the food and spirits
sections of the national Shine Awards, which showcase excellence in glass packaging,
with the spirits winner taking the overall prize. Development work is continuing to
produce lighter bottles, with a 15% lighter standard whisky bottle now being offered 
to the market.
 Primark’s branded ranges
such as ‘Early Days’, 
‘Denim Co’ and ‘Rebel’
target a variety of age
ranges and tastes. Annual Report and Accounts 2002 25
A store is born…
Once the best location for a new Primark store is
identiﬁed, an opening date is set. Construction,
shopﬁtting, stafﬁng, merchandising and point 
of sale technology are all precisely co-ordinated
to meet the deadline. 
Primark’s name and reputation as a great place
to work provides the proﬁle for selecting the best
people for our progressive retail environment.
All new employees take part in a comprehensive
induction and training programme before the
opening to forge a strong team spirit. Specially
selected high performers from all functions 
and levels across the company join the team 
to inspire the new staff and pass on their 
know-how.
The timing of the opening is communicated
through press, radio and leaflet campaigns.
Once the doors are open, customers are
enthused by the Primark proposition – quality
merchandise at very competitive prices in a
pleasant shopping environment. australia’s favourite foods
In Australia and New
Zealand our brands
are leaders in the
bakery market.
 26 Associated British Foods plc Annual Report and Accounts 2002 27
Australia & New Zealand
George Weston Foods is a major processor and producer of
primary and branded food products in Australia and New Zealand.
Sales for the continuing business increased 6% to £580 million. However, cost and
competitive pressures continued to affect the business, particularly the meat and biscuit
operations. As a result, the underlying proﬁt declined from £21 million to £18 million. 
In addition, the poor performance of the meat business has resulted in a ﬁxed asset
impairment provision of £6 million which reduced the profit for the financial year 
to £12 million.
Baking performed very strongly with increases in sales and proﬁt. New products,
volume growth and cost savings more than offset the effects of a competitive market
and increased ﬂour costs. The launch of Noble Rise Crunchy Toast, White and Fruit
varieties, the relaunch of the Bergen range and the launch of the Holsom range were 
all successful during the year. Sales of Noble Rise increased again to strengthen its
position as a leader in the premium bread segment. In August, a new addition to 
the Tip Top range was launched, Tip Top-Up, which is enriched with omega-3 oils
aimed at the increasing number of health conscious families. Early indications are 
very promising.
In June, ﬁre destroyed our largest bakery in Australia at Fairﬁeld in Sydney. Restoration
of very high levels of customer service within days is a testament to the professionalism
and speed with which our employees reacted to the problems. The loss is insured and
plans are well advanced for a replacement bakery.
In milling, signiﬁcant cost savings were achieved and margins improved. There was 
a focus on increasing market share in the ‘low cost to serve’ industrial markets. The
New Zealand operation benefited from a new warehouse and distribution centre in
Auckland and the commissioning of a blending facility to produce locally, higher value
bakery mixes.
Sales were maintained in the biscuit and cake business but proﬁtability was affected 
by higher input costs and a competitive market. The product range was strengthened
with a number of new product launches including extensions to the popular Wagon Wheels
and Ryvita brands. A new range of products featuring Winnie the Pooh and Toy Story
characters was launched. George Weston Foods is the leading cake manufacturer in
Australia with its Top Taste brand.
The meat and dairy business produces some of Australia’s best known brands 
including Don, Watsonia, Melosi and Chapmans. However, substantially higher meat
prices, continuing distribution and operational problems combined with reduced
volumes had a signiﬁcant impact in reducing its proﬁtability. A new senior management
team is focused on resolving the problems and improving margins and proﬁtability.
2002 2001
Sales £m 580 548
Operating proﬁt £m 12 21
Proﬁt margin % 2.1 3.8
Return on capital employed % 5.8 9.7 28 Associated British Foods plc
Australia & New Zealand continued
Elsewhere, Jasol enhanced its presence in the Australian speciality chemical manufacturing
and service market. Several new products were launched during the year, including a
range of oxygen-based sanitising and bleaching products. The underperforming starch
business was sold in March 2002.
On 20 September 2002, George Weston Foods became a wholly-owned subsidiary 
and its shares were delisted from the Australian Stock Exchange on 27 September. 
Our meat & dairy
business is a major
producer of meat
products, including 
hams, salamis 
and sausages.
 Annual Report and Accounts 2002 29
Australia’s favourite brands…
For over 50 years George Weston Foods’ products have had a special place in the hearts and homes 
of Australians. Our brands feature some of the best-loved and most famous names in Australia and New
Zealand, including Tip Top and Noble Rise breads, Wagon Wheels, Quatro, Ryvita and Don. 
The changing tastes of our consumers, coupled with their expectation of the highest quality ensures 
we are constantly adding exciting products to our family of brands. From healthy additions to our 
bread range to indulgent cake and biscuit treats there is always something new on the shelves from
George Weston Foods.  30 Associated British Foods plc
‘Net cash funds... were virtually level with last year at £1,050 million
with the cash generated by the group in the year being almost
sufficient to fund an acquisition spend, net of disposals, of 
£234 million...’
Finance Director’s report Annual Report and Accounts 2002 31
Group performance
Group sales increased by 3% to £4,545 million, and operating
proﬁt, before exceptional items and amortisation of goodwill,
increased by 13% to £395 million.  
Operating proﬁt included the beneﬁt of the release of a £7 million
provision established by British Sugar some years ago for a
potential fine which is no longer needed following a favourable
judgement by the European Court of Justice. In the light of 
the poor performance by the meat & dairy business in George
Weston Foods, a ﬁxed asset impairment provision of £6 million
has been made in arriving at the results of the Australian business.
On 2 July 2002, ACH completed the acquisition of Unilever’s
branded corn oil and corn products business in the US, Canada
and Puerto Rico. We also acquired two ingredients businesses, the
Crusha milk shake syrup business and the Wuxuan cane sugar mill
in China. The total acquisition spend in the year was £268 million. 
Proceeds from the disposal of businesses were £34 million 
which related to the completion of the sale of Nelsons of Aintree
and the ACH rice processing business at Greenville, Mississippi,
both of which were accounted for last year, and £16 million for
the sale of the Australian starch business in March 2002.
We continued to dispose of properties that are no longer required
by the group, although not at the same rate as last year, resulting
in a reduction in the profit on disposal of fixed assets from 
£20 million to £8 million.
Investment income fell from £66 million to £57 million this year
mainly reﬂecting lower interest rates. Interest payable reduced from
£24 million to £22 million as a result of lower average overseas
borrowings and the repayment of the unsecured loan stock. 
Profit before tax increased from £369 million to £420 million.
Adjusted to exclude exceptional items, profits on the sale of 
fixed assets and the amortisation of goodwill, proﬁt before tax
increased 9% from £393 million to £430 million.
Taxation
The tax charge of £95 million included an underlying charge 
of £122 million, which is an effective tax rate of 28.4% on the
adjusted profit before tax and compares to 30.0% in 2001. 
FRS 19 ‘Deferred Taxation’ has been adopted in these accounts for 
the ﬁrst time. This has had the effect of increasing the underlying
tax charge by £11 million in the current year and by £12 million,
an additional 3 percentage points on the tax rate, last year. 
Accumulated tax losses in the US have been recognised this year
in a deferred tax credit of £23 million. The acquisition of Mazola
and the improved performance of our US businesses now provides
the necessary assurance that these losses will be utilised. In
addition, the tax charge for the year beneﬁted from a £4 million
credit for tax relief on the amortisation of goodwill arising on asset
acquisitions in the US. Both of these credits have been excluded
from the calculation of adjusted earnings per share.
Earnings and dividends
Earnings increased by £79 million to £322 million and the
weighted average number of shares in issue remained constant
at 789 million. Earnings per ordinary share increased from 30.8p
to 40.8p. A more consistent measure of performance is provided
by adjusting earnings per share to exclude exceptional items,
proﬁts on the sale of ﬁxed assets and amortisation of goodwill 
net of the tax beneﬁt. Adjusted earnings per share on this basis
increased by 14% from 33.8p to 38.7p.
The ﬁrst interim dividend was maintained at 4.25p and a second
interim dividend has been declared at 9.00p representing an
overall increase of 12% for the year. Dividends will cost a total of
£105 million. Dividend cover, on an adjusted basis, is 2.9 times
(2001 – 2.9 times). £217 million will be transferred to reserves.
Accounting for pension costs
The charge for pension costs in the accounts has been calculated
in accordance with SSAP 24 based on the most recent actuarial
valuations. In the case of the group’s main UK scheme, the last
formal valuation was undertaken at April 1999 since when the
market value of investments has deteriorated. A new valuation 
was undertaken as at April 2002 but has yet to be ﬁnalised. The
draft report indicates that the scheme remains in surplus and 
there would have been no change to the SSAP 24 charge were 
this valuation to have been adopted for the preparation of these
accounts. However, in light of the changes in market conditions
since April 2002, an informal valuation was conducted as at 32 Associated British Foods plc
Finance Director’s report continued
September 2002 by the scheme’s actuaries. Although the informal
September valuation revealed a further reduction in the surplus,
there still remains a modest surplus. If current ﬁnancial market
conditions prevail, the company will recommence some level 
of contribution to the main UK scheme.
Balance sheet
Fixed assets increased by £228 million to £1,804 million
principally due to the additional goodwill arising on acquisitions
in the year. Net cash funds, being current asset investments
and cash at bank less short-term borrowings and loans, were
virtually level with last year at £1,050 million with the cash
generated by the group in the year being almost sufficient 
to fund an acquisition spend, net of disposals, of £234 million
and capital expenditure of £186 million. The acquisition of
Mazola was ﬁnanced by a medium term US dollar ﬂoating rate
bank facility which accounts for the increase in loans falling
due after one year.
Working capital, including tax and dividend accruals, reduced 
by £34 million mainly as a result of higher tax and trade
accruals. The group’s net assets increased by £201 million 
to £3,066 million.
A currency loss of £16 million, net of tax relief, arose on the
translation into sterling of the group’s non-sterling net assets
principally in the US. 
Return on capital employed, deﬁned as the operating proﬁt
before exceptional items and amortisation of goodwill expressed 
as a percentage of year end capital employed, improved from
18.8% to 21.0% for the continuing businesses of the group.
Strong proﬁt and margin improvements were made in primary
food & agriculture, ingredients & oils and grocery. Although
margins declined at Primark, the return on capital employed
improved as a full year proﬁt was realised on the large number 
of stores opened towards the end of the last financial year.
The difﬁculties at George Weston Foods were reﬂected in declines
in proﬁt and return on capital employed.
Cash ﬂow
Net cash flow from operating activities was £523 million, 
£96 million higher than last year, as a result of the strong
increase in proﬁt before depreciation and amortisation of goodwill
and a lower increase in working capital, compared to last year.
Capital expenditure during the year was £186 million of which
£51 million was spent on the acquisition or reﬁtting of Primark
stores and the balance was used principally to upgrade, modernise
and expand existing manufacturing facilities. 
The net expenditure on acquisitions less proceeds from disposals
amounted to £234 million. 
Treasury policy and controls
The group’s cash and current asset investments totalled 
£1,501 million at the year end including some £942 million
placed with professional investment managers who have full
discretion to act within closely monitored and agreed guidelines.
The investment objective is to preserve the underlying assets, 
whilst achieving a satisfactory return. The investment guidelines
are kept under constant review with the objective of monitoring
and controlling risk levels. The guidelines require that investments
must carry a minimum credit rating of AA- and also set down
conditions relating to sovereign risk, length of maturity, exchange
rate exposure and type of investment instrument. Aggregate
limits for each category of investment and risk exposure are set
for each manager.
The group’s UK cash balances are managed by a central treasury
department operating under strictly controlled guidelines, which
also arranges term bank ﬁnance, as and when necessary, to
finance short-term working capital requirements particularly 
for the sugar beet and wheat harvests.
Futures contracts used as hedges in commodity trading operations
are tightly controlled within set limits and transactions of a
speculative nature are not undertaken.
Foreign currency
The businesses operate mainly in their local currency and 
as a result the group’s transaction exposure to exchange rate
movements is minimal. Signiﬁcant cross-border transactions are
covered by forward purchases and sales of foreign currency, 
or foreign currency options as appropriate. Annual Report and Accounts 2002 33
The group does not hedge the translation effect of exchange 
rate movements on the profit and loss account. Although 
the Mazola acquisition was financed by a five year US dollar
loan, generally the group regards its interest in its overseas
subsidiary undertakings as long-term investments and does 
not hedge the translation effect of exchange rate movements 
on them.
Post balance sheet events 
On 20 September 2002, the minority shareholdings in George
Weston Foods in Australia were acquired at a cost of £58 million.
The company was subsequently delisted from the Australian
Stock Exchange on 27 September 2002.
On 8 October 2002, we announced the acquisition of the food 
and beverage business, comprising Ovaltine and associated
brands, from Novartis for £171 million. Net tangible assets 
are estimated to be £45 million at completion. Completion 
will follow the grant of appropriate regulatory approvals.
Financial reporting standards and accounting policies
No new ﬁnancial reporting standards have been issued during
the year. 
FRS 17 ‘Retirement Beneﬁts’, requires additional disclosures 
to be made this year and these have been included in the notes
to the accounts. The Accounting Standards Board is currently
reviewing the date for full adoption of the standard.
FRS 19 ‘Deferred Taxation’, has been adopted in the accounts
for the year ended 14 September 2002.
With the exception of the adoption of FRS 19, there have 
been no changes to the group’s accounting policies from the
previous year.
John Bason  
Finance Director
‘Return on capital employed... improved from 18.8% to 21.0% for
the continuing businesses of the group.’ Executive directors
1 Harold W Bailey (age 66)
A director since 1979, he was appointed Chairman in May 2000. He is a member 
of the Institute of Chartered Accountants of Scotland and is a director of Wittington
Investments Limited.
2 George G Weston (age 38)
Appointed to the board on 19 April 1999, he was appointed Deputy Chairman in 
May 2000. He ﬁrst joined the company in 1988 as manager of the group’s ﬂour milling
operations in Melbourne, Australia. He is Chief Executive of Allied Bakeries and is a
director of Wittington Investments Limited.
3 Peter J Jackson (age 55)
A director since 1992, he was appointed Chief Executive on 1 June 1999. He was
previously Chief Executive of British Sugar plc.
4 John G Bason (age 45)
Appointed Finance Director in May 1999, he was previously the ﬁnance director of Bunzl plc
and is a member of the Institute of Chartered Accountants in England and Wales.
34 Associated British Foods plc
Board of directors
13
4 2 Non-executive directors
5 WG Galen Weston OC (age 61)
A director since 1964, he is Chairman and President of George Weston Limited,
Canada, a director of Canadian Imperial Bank of Commerce and Chairman of 
Holt, Renfrew & Co and of Brown Thomas, Ireland. He is a director of Wittington
Investments Limited.
6 Martin G Adamson (age 63)†
Appointed a director on 11 October 1999, he was a senior partner of KPMG and a member
of that ﬁrm’s board until 1996. He is a member of the Institute of Chartered Accountants of
Scotland and is Chairman of Compass Group Pension Trustee Company Limited.
7 Professor Sir Roland Smith (age 73)†
A director since 1994, he is Emeritus Professor of Management Science in the University
of Manchester.
8 Michael R Alexander (age 54)†
Appointed a director on 16 January 2002, he spent his earlier career with BP plc where
he held a number of management positions. He is a director and chief operating ofﬁcer
of Centrica plc.
9 Rt. Hon. Lord MacGregor of Pulham Market, OBE (age 65)†
A director since 1994, he was a Member of Parliament from 1974 to 2001, with 15 years
in government including nine years in the Cabinet. He is a director of Slough Estates plc,
Uniq plc, Friends Provident plc, and a member of the supervisory board of DAF Trucks N.V.
Annual Report and Accounts 2002 35
†Independent non-executive director
Professor Sir Roland Smith is the Senior
Independent Director.
Harold W Bailey, Professor Sir Roland Smith,
Lord MacGregor and Martin G Adamson 
are members of the Remuneration and
Nomination committees. 
Professor Sir Roland Smith, Lord MacGregor
and Martin G Adamson are members of
the Audit committee.
57
8 6
9 36 Associated British Foods plc
Directors’ report 
The directors submit to the members their sixty-seventh annual
report together with the ﬁnancial statements of the company 
for the 52 weeks ended 14 September 2002. 
The corporate citizenship, corporate governance and
remuneration reports on pages 38 to 45 form part of this
directors’ report.
Proﬁts and dividends
The group proﬁt and loss account is on page 48. Proﬁt for the
ﬁnancial year amounted to £322 million and the dividends to 
£105 million. Dividends are detailed in note 8 on page 61.
Review of activities
The activities of the group principally concern the processing and
manufacture of food in Europe, Australia, New Zealand, Asia and
the US, and textile retailing in the UK and the Republic of Ireland.
Comments on the development of the business during the period
under review and on the future outlook are contained within 
the Chairman’s statement, the Chief Executive’s review and the
Finance Director’s report on pages 4 to 33.
Tangible ﬁxed assets
The group’s tangible fixed assets are included in the financial
statements at cost. The properties are employed in the business
and many of them were acquired when market values were
substantially lower than at present. The directors consider that
a surplus over book value exists, but are unable to quantify 
the excess.
Substantial shareholdings
Details of a controlling interest in the shares of the company 
are given in note 30 on page 72.
Other than as noted above, so far as is known, no other person
holds or is beneﬁcially interested in a disclosable interest in 
the company.
Power to issue shares
At the last annual general meeting held on 7 December 2001,
authority was given to the directors to allot unissued relevant
securities in the company up to a maximum of an amount
equivalent to one third of the shares in issue at any time up 
to 6 December 2006. No such shares have been issued. 
The directors propose to renew this authority at the annual
general meeting to be held on 5 December 2002 for a further
period of ﬁve years.
A further special resolution passed at that meeting granted
authority to the directors to allot equity securities in the company
for cash, without regard to the pre-emption provisions of the
Companies Act 1985. This authority expires on the date of 
the annual general meeting to be held on 5 December 2002 
and the directors will seek to renew this authority for a further
period of one year.
Associated British Foods plc 1994 Share Option Scheme 
(‘the Scheme’)
The Scheme was established by the company in 1994. 
Under the terms of the Scheme, options to purchase 
ordinary shares in the company may be granted to selected
qualifying employees over the ten years from November 1994. 
The exercise of options is not subject to specified 
performance criteria.
Associated British Foods plc Executive Share Option Scheme
(‘the Executive Scheme’)
This scheme was approved and adopted by the company at the
annual general meeting held on 15 December 2000. Under the
terms of the Executive Scheme options to purchase ordinary
shares in the company may be granted to selected employees
over the ten years from 15 December 2000. The exercise of an
option under this scheme will, in accordance with institutional
shareholder guidelines, be conditional on the achievement of
performance criteria which are based on growth in the group 
and subsidiary company proﬁts. 
Auditors
In accordance with Section 384 of the Companies Act 1985, 
a resolution for the reappointment of KPMG Audit Plc as
auditors of the company is to be proposed at the forthcoming
annual general meeting.
Directors
The names of the persons who were directors of the company 
as at 5 November 2002 appear on pages 34 and 35. Annual Report and Accounts 2002 37
In accordance with the Articles of Association, GG Weston, 
JG Bason and MG Adamson retire from the board by rotation
and, being eligible, offer themselves for re-election. HW Bailey
will retire from the board at the conclusion of the annual 
general meeting.
In accordance with the Articles of Association, MR Alexander,
having been appointed since the date of the last annual general
meeting and, being eligible, offers himself for election.
Controlling interest
The ultimate holding company of Associated British Foods plc is
Wittington Investments Limited, which together with its subsidiary
undertaking, Howard Investments Limited, held 54.5% of the
total issued ordinary share capital.
Non-beneﬁcial interests
The directors of the company at the end of the year had the
following non-beneﬁcial interests:
1 WG Galen Weston and George G Weston are trustees of a 
trust, in which they have no beneﬁcial interest, which at 
14 September 2002 held 683,073 ordinary shares of 50p
(2001 – 683,073) in Wittington Investments Limited.
2 Harold W Bailey is a trustee of a trust, in which he has 
no beneﬁcial interest, which at 14 September 2002 held 
38,665 ordinary shares of 5
15
/22p (2001 – 38,665) in
Associated British Foods plc.
Subsequent changes
The interests shown above remained the same at 5 November 2002.
By order of the board
Paul Lister
Secretary
5 November 2002 38 Associated British Foods plc
Corporate citizenship
Business principles
The group’s organisational structure is decentralised and based on
short lines of communication. Management responsibilities for the
major businesses are devolved to their chief executives who report
directly to the Chief Executive.
As such our businesses devise procedures appropriate to and
compliant with local laws, culture and operating conditions but
within the overall context of the following overriding principles.
Employment
General principles
Managers of our businesses continue to evolve procedures
appropriate to the size and organisation of their businesses. 
These procedures take account of the core International Labour
Organisation conventions and, in addition, are designed to keep
employees and their representatives briefed on all relevant matters.
The group is committed to offering equal opportunities to all
persons in their recruitment, training and career development,
having regard for their particular aptitudes and abilities. Full and
fair consideration is given to applicants with disabilities and every
effort is made to give employees who become disabled whilst
employed by the company an opportunity for retraining.
Health and safety
We consider health and safety as equal in importance to that of
any other function of the company and its business objectives.
Within the overall context of complying with all relevant legislation, 
the responsibility for health and safety within each of our
businesses rests with its chief executive or managing director. 
The aims of the health and safety policy
The purpose of this health and safety policy is to establish, as 
far as possible, requisite standards across our UK businesses. 
We will take such steps as are reasonably practicable, to ensure
that they meet their health and safety objectives. These are:
• to provide and maintain safe and healthy working places and
systems of work in order to protect all employees and others,
including visitors and the public, in so far as they come into
contact with foreseeable work hazards;
• to provide and maintain a safe and healthy working
environment for all employees, taking into account individuals’
needs and abilities; and
• to develop safety awareness amongst all employees to enable them
to take reasonable care for their own health and safety and that
of other people who may be affected by their acts or omissions.
Ethical procurement
We seek to develop relationships with supplier companies
consistent with the basic principles as set out above, and
specifically with respect to human rights and conditions of
employment. Where supplier audits show shortcomings in any 
of these areas we will strive to encourage a programme of
improvement leading to compliance. Responsibility for speciﬁc
supplier codes and agreements rests with individual companies. 
Environment
The purpose of our environmental policy is to establish, as far 
as possible, uniform standards across our businesses. In the UK,
we will take such steps as are necessary to ensure that:
• emissions to air, releases to water and land ﬁlling of solid wastes
do not cause unacceptable environmental impacts and do not
offend the community; 
• significant plant and process changes are assessed 
and positively authorised in advance to prevent adverse
environmental impacts; 
• energy is used efﬁciently and consumption is monitored; 
• raw material waste is minimised; 
• solid waste is reduced, reused or recycled where practicable; 
• the amount of packaging used for group products is
minimised, consistent with requirements for food safety 
and product protection; 
• products are transported efficiently to minimise fuel usage,
consistent with customers’ demands, production arrangements
and vehicle ﬂeet operations; Annual Report and Accounts 2002 39
• accidents are prevented so far as is reasonably 
practical; and
• effective emergency response procedures are in place
to minimise the impact of foreseeable incidents.
The nominated ofﬁcer with responsibility for environmental
affairs is Paul Lister, Company Secretary. 
Human rights
We strive to observe, in all our operations, the principles and 
spirit of the UN Charter (Chapter IX Article 55) and in particular 
as stated below:
‘Universal respect for and observance of human rights and
fundamental freedoms for all without discrimination as to race,
sex, language or religion.’
Stakeholder relationships
Suppliers
In the conduct of our business, we do not have a formal code
that we follow with regard to payments to suppliers but will deal
openly and fairly with suppliers, adhere to contract terms and
avoid the exercise of undue pressure. We agree payment terms
with suppliers at the time we enter into binding purchasing
contracts for the supply of goods and services. Our suppliers are 
in that way made aware of these terms. We seek to abide by
these payment terms whenever we are satisﬁed that the supplier
has provided the goods or services in accordance with the agreed
terms and conditions.
Associated British Foods plc has no trade creditors.
Shareholders
Apart from the annual general meeting, which is considered to be
an important forum for communicating with private shareholders,
the company communicates with its shareholders by way of the
annual report and accounts, the half-yearly interim report and 
at www.abf.co.uk, the company’s website. Signiﬁcant matters relating
to the trading or development of the business are disseminated
to the market by way of Stock Exchange announcements. 
The company also holds meetings with its major institutional
shareholders to discuss the company’s operations.
The community
We encourage our businesses to engage with the local community
in their areas of operation. Examples of this include cultural and
community sponsorship in Australia through George Weston
Foods (see www.georgewestonfoods.com for details) and 
the community activities of British Sugar through the British
Sugar Foundation (Policy and Guidelines reproduced in full 
at www.britishsugar.co.uk).
The Garﬁeld Weston Foundation was set up by our founder, the
late W Garﬁeld Weston, in 1958. It is one of the UK’s foremost
philanthropic organisations. 
Contributions to charitable organisations by the group during the
year totalled £0.2 million (2001 – £0.2 million). Political donations
were made during the year by Food Investments Pty in Australia
to the Liberal Party of Australia £54,900 (2001 – £30,819) and
to the Australian Labour Party £4,766 (2001 – £7,609).
Customers
We seek to be honest and fair in our relationships with our customers
and above all to provide the standards of product and service that
have been agreed. At all times we take all reasonable steps to ensure
the safety and quality of the goods or services that we produce.
Research and development
Innovative use of existing and emerging technologies will continue
to be crucial to the successful development of new products and
processes for the group.
We have major technical centres in the UK at the Allied
Technical Centre and the animal feed Central Laboratories.
Facilities also exist at ACH Food Companies in the US, Weston
Technologies in Australia and AB Enzymes in Germany. These
centres support the technical resources of the trading divisions in
the search for new technology and in monitoring and maintaining
high standards of quality and food safety. 40 Associated British Foods plc
Corporate governance
Corporate governance has been and remains the responsibility 
of the whole board which is committed to the highest standards.
This statement describes how the company applies the principles
and complies with the provisions of the Combined Code –
Principles of Good Governance and Code of Best Practice 
(‘the Combined Code’).
Statement of compliance
The board considers that it is in full compliance with the
provisions set out in Section 1 of the Combined Code with 
the exception of the recommendation that the Remuneration
committee should only comprise non-executive directors. 
The board of Associated British Foods plc does not accept 
this recommendation as it considers that Harold W Bailey,
Executive Chairman, should serve on the committee in view 
of his unique knowledge of the business and its people.
The statement of directors’ responsibilities for preparing the
financial statements is set out on page 46.
The board of directors
The board is made up of the Chairman, Harold W Bailey, the
Chief Executive Peter J Jackson, two other executive directors
and five non-executive directors. Details of the full board are 
set out on pages 34 and 35. For the purposes of the Combined 
Code, WG Galen Weston is not regarded as independent, but 
the board considers that he, together with the other non-executive
directors, provides a good balance for the proper governance 
of the company. The board meets formally at least eight times
each year, with other meetings as appropriate and has a formal
schedule of matters reserved to it for decision. It also delegates
speciﬁc responsibilities to board committees, notably the Audit,
Remuneration and Nomination committees. Directors receive
board and committee papers in advance of meetings and also
have access to the advice and services of the Company Secretary.
The board has adopted a procedure whereby directors may, in
the furtherance of their duties, take independent professional
advice on any matter at the company’s expense.
The roles of the Chairman and the Chief Executive are 
separately held and are so deﬁned as to ensure a clear division 
of responsibilities. Professor Sir Roland Smith is the recognised
Senior Independent Director.
The Articles of Association require that one third of directors retire by
rotation at the annual general meeting in each year subject to the
requirement that each director seeks re-election every three years.
Board committees
Remuneration committee
During the year the Remuneration committee comprised three
independent non-executive directors and Harold W Bailey. 
The Remuneration committee sets the remuneration and other
terms of employment of executive directors, and the company’s
policy on remuneration of the senior executives, within terms 
of reference agreed by the board.
The remuneration of the non-executive directors is determined 
by the board. The remuneration report on pages 42 to 45
gives full details of the company’s policy and of directors’
remuneration packages.
Nomination committee
The Nomination committee reviews the composition of the board
and recommends to the board appointments of new executive
and non-executive directors of the company. It comprises one
executive director and three independent non-executive directors
and is chaired by the Chairman.
Audit committee
The Audit committee has terms of reference modelled closely
upon those recommended in the Combined Code. It comprises
three independent non-executive directors and is chaired by
Professor Sir Roland Smith. It meets regularly to receive and
review reports from the external auditors and from management.
The Audit committee is responsible for reviewing the company’s
internal controls, risk management procedures and the audit
process and seeks to ensure that the ﬁnancial and non-ﬁnancial
information supplied to shareholders is complete and accurate
and presents a balanced assessment of the company’s position.
The committee reviews the objectivity and independence of the
external auditors and also considers the scope of their work and
their fees.
Internal controls
The directors acknowledge their responsibilities for the group’s
system of internal controls, ﬁnancial and otherwise. This involves Annual Report and Accounts 2002 41
ensuring that the assets have been protected against unauthorised
use, that proper accounting records have been maintained and that
the ﬁnancial information which is produced is reliable. However such
a system is designed to manage rather than eliminate the risk of
assets being unprotected against unauthorised use and of failure to
achieve business objectives. The system can provide only reasonable
and not absolute assurance against material mis-statement or loss.
The directors recognise that they are responsible for providing a
return to shareholders which is consistent with the responsible
assessment and mitigation of risks.
The directors confirm that there is an ongoing process for
identifying, evaluating and managing the risks faced by the group,
which has been in place for the year under review and up to the
date of approval of the annual report and accounts and that they
have regularly reviewed the system of internal controls utilising 
the review process set out below.
• Standards 
There are group-wide guidelines on the minimum requirements
for health and safety and environmental standards. There are
also group-wide guidelines on the minimum level of internal
control that each of the divisions should exercise over speciﬁed
processes. Each business has developed and documented
policies and procedures to comply with the minimum control
standards established, including procedures for monitoring
compliance and taking corrective action. The board of each
business is required to conﬁrm annually that it has complied
with those policies and procedures.
• High level controls 
All operations prepare annual plans and budgets for
operational and cash performance, which are updated
regularly. Performance against budget is monitored at
operational level and centrally, with variances being reported
promptly. The cash position at group and operational level 
is monitored constantly and variances from expected levels 
are investigated thoroughly.
A signiﬁcant part of the group’s cash reserves is managed by
independent fund managers operating within detailed guidelines
speciﬁed by the group relating to, inter alia, permitted investments
and counter parties, currency exposures and approved
instruments. The balance of the group’s cash reserves is
managed by its treasury function in accordance with guidelines
referred to in the Finance Director’s report.
Clearly deﬁned guidelines have been established for capital
expenditure and investment decisions encompassing budgets,
appraisal and review procedures and levels of authority.
• Risk management review
The detailed policies and internal control procedures
established at operational level are reviewed by group
personnel. Each business is responsible for regularly assessing
its risk management activities to ensure good practice in all
areas. These assessments are reviewed by group personnel
twice a year. The Audit committee receives reports on internal
control issues from management and from the external auditors.
Going concern
After making due enquiries, the directors have a reasonable
expectation that the group has adequate resources to continue
in operation for the foreseeable future. For this reason they
continue to adopt the going concern basis for preparing the
financial statements on pages 48 to 74. 42 Associated British Foods plc
Remuneration report 
Remuneration levels are set by reference to individual
performance, experience and market conditions with a view to
providing a package which is appropriate for the responsibilities
involved. Under the terms of the group’s existing arrangements:
i) performance related bonuses are payable to executive
directors. Payment of such bonuses is dependent upon 
the achievement of demanding preset targets relating 
to operating profit and return on capital employed.
Performance related bonuses are not pensionable other 
than in the case of Peter J Jackson for whom there is a
contractual obligation.
ii) subject to the rules of the company’s share option schemes,
Peter J Jackson and John G Bason are both entitled under
their service contracts to receive an allocation of share
options for each of ﬁve years and three years respectively,
commencing December 1999.
The company operates an executive pension scheme for senior
executives, which is incorporated in the main group scheme. 
The scheme is a deﬁned beneﬁt scheme whereby retirement
beneﬁts based on ﬁnal remuneration and length of service are
funded through a trustee administered scheme. The company
pays contributions to the scheme on behalf of executives, based 
on the recommendations of the independent actuary who carries
out a valuation of the scheme every three years.
No director has a contract of service with the company which 
is determinable after one year.
The remuneration of the directors was as follows:
Salary 2002 2001
or fees Bonus Beneﬁts Total Total
£’000 £’000 £’000 £’000 £’000
Harold W Bailey 168 – 12 180 173
George G Weston 198 35 12 245 204
Peter J Jackson 449 135 17 601 568
John G Bason 340 101 17 458 415
WG Galen Weston – – – – –
Lord MacGregor 29 – – 29 28 
Professor Sir Roland Smith 31 – – 31 28 
Martin G Adamson 29 – – 29 28
Michael R Alexander 20 – – 20 –
1,264 271 58 1,593 1,444 
Beneﬁts include the value attributed to beneﬁts such as company cars, fuel and medical insurance. Annual Report and Accounts 2002 43
(1) The pension entitlement shown is that which would be paid
annually on retirement based on service to the end of the
year, or date of retirement if earlier.
(2) Contributions paid or payable in the year by the directors
under the terms of the scheme.
(3) The increase in accrued pension during the year excludes
any increase for inﬂation.
(4) John Bason and George Weston accrue pensions in the
Associated British Foods Pension Scheme on their earnings 
up to the Earnings Cap. In order to provide a pension on 
their earnings above this level, the company has established 
an unfunded unapproved retirements beneﬁts scheme.
The company has also established a funded unapproved 
life assurance scheme to provide cover for the excess over
that provided by the Pension Scheme.
(5) The company paid a pension to a former director of £nil 
(2001 – £6,000).
Dependants’ pensions – A 50% spouse’s pension is payable 
on death, before or after retirement. In respect of Peter J Jackson,
the spouse’s pension is 66.66%.
Early retirement rights – The directors may retire before their
normal retirement age, subject to a reduction for early payment.
Pension increases – Pensions are guaranteed to increase in line
with the increases in RPI, restricted each year to 5%. Additional
discretionary increases have been granted in the past.
Pension beneﬁts earned by the directors (1):
Directors’ Increase in accrued Accumulated total
contributions pension entitlement accrued pension
Normal in the year (2) during the year (3) at year end
Age at retirement 2002 2001 2002 2001 2002 2001
year end age £’000 £’000 £’000 £’000 £’000 £’000
George G Weston 38 65 10 9 10 9 40 30 
Peter J Jackson 55 60 – – 57 32 249 189 
John G Bason 45 62 14 14 8 15 23 15  44 Associated British Foods plc
Remuneration report continued
At 14 September 2002, the following directors had outstanding options to acquire ordinary shares of Associated British Foods plc.
Date
At 15.9.01 At 14.9.02 Exercise from which Expiry
Number Granted Number price exercisable date
Peter J Jackson 100,000 – 100,000 561.50p 28.4.2003 27.4.2008
100,000 – 100,000 345.25p10.12.2004 9.12.2009
100,000 – 100,000 484.00p 17.1.2004 16.1.2011
– 100,000 100,000 497.00p 7.12.2006 6.12.2011
George G Weston 15,000 – 15,000 561.50p 28.4.2003 27.4.2008
45,000 – 45,000 484.00p 17.1.2004 16.1.2011
John G Bason 100,000 – 100,000 467.00p 11.5.2004 10.5.2009
50,000 – 50,000 484.00p 17.1.2004 16.1.2011
– 50,000 50,000 497.00p 7.12.2006 6.12.2011
No other directors had any options during the year and no options lapsed or were exercised during the year.
The mid-market price of the shares at 14 September 2002 was 590p. The highest mid-market price during the year was 631p and
the lowest mid-market price was 436p. Annual Report and Accounts 2002 45
Directors’ beneﬁcial interests
The directors of the company at the year end had the following beneficial interests, including family interests, in the shares and
debentures of the company, its holding company and fellow subsidiary undertakings.
14 September 15 September
2002 2001 
Harold W Bailey
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 140,800 140,800
Fortnum & Mason PLC, ordinary shares of 5p – 1,000
George G Weston
Wittington Investments Limited, ordinary shares of 50p 5,862 5,862
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 3,146,761 3,146,761
Peter J Jackson
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 17,600 17,600
John G Bason
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 6,000 1,500
WG Galen Weston
Wittington Investments Limited, ordinary shares of 50p 37,953 37,953
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 5,672,560 5,672,560
Lord MacGregor
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 2,045 2,045 
Martin G Adamson
Associated British Foods plc, ordinary shares of 5
15
⁄ 22p 20,000 10,000 Directors’ responsibilities
46 Associated British Foods plc
Company law requires the directors to prepare ﬁnancial statements
for each ﬁnancial year which give a true and fair view of the state
of affairs of the company and of the group and of the profit or
loss for that period. In preparing those ﬁnancial statements, the
directors are required to:
• select suitable accounting policies and then apply 
them consistently;
• make judgements and estimates that are reasonable 
and prudent;
• state whether applicable accounting standards have been
followed, subject to any material departures disclosed 
and explained in the ﬁnancial statements; and
• prepare the ﬁnancial statements on the going concern 
basis unless it is inappropriate to presume that the group 
will continue in business.
The directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time the
financial position of the company and to enable them to ensure
that the ﬁnancial statements comply with the Companies Act 1985.
They have general responsibility for taking such steps as are
reasonably open to them to safeguard the assets of the group 
and to prevent and detect fraud and other irregularities. Annual Report and Accounts 2002 47
We have audited the ﬁnancial statements on pages 48 to 74. 
Respective responsibilities of directors and auditors
The directors are responsible for preparing the annual report 
and accounts. As described on page 46 this includes responsibility
for preparing the financial statements in accordance with
applicable UK law and accounting standards. Our responsibilities,
as independent auditors, are established in the UK by statute, 
the Auditing Practices Board, the Listing Rules of the Financial
Services Authority, and by our profession’s ethical guidance. 
We report to you our opinion as to whether the ﬁnancial statements
give a true and fair view and are properly prepared in accordance
with the Companies Act 1985. We also report to you if, in our
opinion, the directors’ report is not consistent with the ﬁnancial
statements, if the company has not kept proper accounting records,
if we have not received all the information and explanations 
we require for our audit, or if information speciﬁed by law or the
Listing Rules regarding directors’ remuneration and transactions
with the group is not disclosed. 
We review whether the statement on pages 40 and 41 reﬂects 
the company’s compliance with the seven provisions of the 
Combined Code speciﬁed for our review by the Listing Rules, 
and we report if it does not. We are not required to consider
whether the board’s statements on internal control cover all 
risks and controls, or form an opinion on the effectiveness 
of the group’s corporate governance procedures or its risk 
and control procedures. 
We read the other information contained in the annual report,
including the corporate governance statement, and consider
whether it is consistent with the audited ﬁnancial statements. 
We consider the implications for our report if we become aware 
of any apparent mis-statements or material inconsistencies with
the ﬁnancial statements. 
Basis of audit opinion
We conducted our audit in accordance with Auditing Standards
issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts
and disclosures in the ﬁnancial statements. It also includes an
assessment of the signiﬁcant estimates and judgements made by
the directors in the preparation of the ﬁnancial statements, and 
of whether the accounting policies are appropriate to the group’s
circumstances, consistently applied and adequately disclosed. 
We planned and performed our audit so as to obtain all the
information and explanations which we considered necessary 
in order to provide us with sufﬁcient evidence to give reasonable
assurance that the ﬁnancial statements are free from material 
mis-statement, whether caused by fraud or other irregularity or 
error. In forming our opinion we also evaluated the overall adequacy
of the presentation of information in the ﬁnancial statements.
Opinion
In our opinion the financial statements give a true and fair 
view of the state of affairs of the company and the group as at 
14 September 2002 and of the proﬁt of the group for the year
then ended and have been properly prepared in accordance 
with the Companies Act 1985.
KPMG Audit Plc
Chartered Accountants 
Registered Auditor 
8 Salisbury Square
London 
EC4Y 8BB
5 November 2002
Independent auditor’s report to the members 
of Associated British Foods plc 48 Associated British Foods plc
Before
exceptional Exceptional Total
2002 items items 2001
(restated) (restated) (restated)
Note £m £m £m £m
Turnover of the group including its share
of joint ventures 4,567 4,434 – 4,434  
Less share of turnover of joint ventures (22) (16) – (16) 
Group turnover 1 4,545 4,418 – 4,418  
Operating costs 2 (4,175) (4,085) (62) (4,147)
Group operating proﬁt 370 333 (62) 271
Share of operating results of – joint ventures 3 3– 3 
– associates 4 4 – 4
Total operating proﬁt 1 377 340 (62) 278 
Operating proﬁt before exceptional items
and amortisation of goodwill 395 351 – 351
Amortisation of goodwill (18) (11) (62) (73)
Proﬁts less losses on sale of ﬁxed assets 8 20 – 20 
Proﬁts less losses on sale of businesses – – 29 29
Investment income 5 57 66 – 66
Proﬁt on ordinary activities before interest 442 426 (33) 393
Interest payable 6 (22) (24) – (24)
Proﬁt on ordinary activities before taxation 420 402 (33) 369
Adjusted proﬁt before taxation 430 393 – 393
Proﬁts less losses on sale of ﬁxed assets 8 20 – 20
Exceptional items – –2929
Amortisation of goodwill (18) (11) (62) (73)
Tax on proﬁt on ordinary activities 7 (95) (118) – (118)
Proﬁt on ordinary activities after taxation 325 284 (33) 251 
Minority interests – equity (3) (8) – (8)
Proﬁt for the ﬁnancial year 322 276 (33) 243
Dividends – interim 8 (105) (93) – (93)
Transfer to/(from) reserves 21 217 183 (33) 150
Basic and diluted earnings per ordinary share 9 40.8p 30.8p
Adjusted earnings per ordinary share 9  38.7p 33.8p
The group has made no material acquisitions nor discontinued any operations within the meaning of the Financial Reporting Standards
during either 2002 or 2001.
The results for the year ended 15 September 2001 have been restated to reﬂect the adoption of FRS 19 ‘Deferred Taxation’. The impact 
of this change is detailed in the accounting policies on page 54.
Consolidated proﬁt and loss account
for the year ended 14 September 2002 Consolidated balance sheet
at 14 September 2002
Annual Report and Accounts 2002 49
2002 2001
(restated)
Note £m £m
Fixed assets
Intangible assets – goodwill 10 383 179
Tangible assets 11 1,421 1,397
1,804 1,576
Interest in net assets of – joint ventures 13 9 9 
– associates 13 12 9 
Other investments 13 11 12
Total ﬁxed asset investments 32 30 
1,836 1,606 
Current assets
Stocks 14 498 469
Debtors 15 552 551
Investments 16 1,362 1,195
Cash at bank and in hand 139 95
2,551 2,310
Creditors amounts falling due within one year
Short-term borrowings 17 (64) (82)
Other creditors 18 (736) (672)
(800) (754)
Net current assets 1,751 1,556
Total assets less current liabilities 3,587 3,162
Creditors amounts falling due after one year
Loans 17 (387) (157)
Other creditors 18 (8) (10)
(395) (167)
Provision for liabilities and charges 19 (126) (130)
3,066 2,865
Capital and reserves
Called up share capital 20 47 47 
Revaluation reserve 21 3 3
Other reserves 21 173 173
Proﬁt and loss account 21 2,768 2,567
Equity shareholders’ funds 2,991 2,790
Minority interests in subsidiary undertakings – equity 75 75
3,066 2,865
These ﬁnancial statements were approved by the board of directors on 5 November 2002 and were signed on its behalf by:
Harry Bailey Director
John Bason Director 50 Associated British Foods plc
2002 2001
Note £m £m
Cash ﬂow from operating activities 25 523 427
Dividends from joint ventures 3 3 
Dividends from associates 1 1
Return on investments and servicing of ﬁnance
Investment income 60 66
Interest paid (22) (24)
Dividends paid to minorities (4) (10)
34 32 
Taxation (97) (127)
Capital expenditure and ﬁnancial investment
Purchase of tangible ﬁxed assets (186) (212)
Sale of tangible ﬁxed assets 40 39 
Purchase of equity investments – (1)
Sale of equity investments 4 7 
(142) (167)
Acquisitions and disposals
Purchase of new subsidiary undertakings 26 (267) (121)
Purchase of joint ventures and associates (1) –
Sale of subsidiary undertakings 26 34 142
(234) 21
Equity dividends paid (93) (88)
Net cash (outﬂow)/inﬂow before use of liquid funds and ﬁnancing (5) 102
Management of liquid resources 28 (164) (76)
Financing
Borrowings due within one year – repayment of loans (102) (28)
– increase in loans 103 42
Borrowings due after one year – repayment of loans (7) (13)
– increase in loans 238 5 
Increase in bank borrowings (16) –
Increase in cash 47 32 
Consolidated cash ﬂow statement
for the year ended 14 September 2002 Annual Report and Accounts 2002 51
2002 2001
£m £m
Proﬁt for the ﬁnancial year 322 243 
Currency translation differences on foreign currency net assets (21) (44)
Tax on currency translation differences 5 7
Total recognised gains and losses relating to the period 306 206
Prior year adjustment (91)
Total recognised gains and losses since previous year end 215
Consolidated statement of historical cost proﬁts
for the year ended 14 September 2002
There is no material difference between the group results as reported and on an unmodiﬁed historical cost basis. Accordingly, no note
of historical cost proﬁts and losses has been prepared.
Reconciliation of movements in shareholders’ funds
for the year ended 14 September 2002
Company Group
2002 2001 2002 2001
(restated)
£m £m £m £m
Opening shareholders’ funds as previously reported 232 215 2,881 2,763
Prior year adjustment – – (91) (91)
Opening shareholders’ funds restated 232 215 2,790 2,672 
Proﬁt for the ﬁnancial year 94 110 322 243
Dividends (105) (93) (105) (93) 
Goodwill written back – – – 5
Other recognised gains and losses relating to the year – – (16) (37) 
Closing shareholders’ funds 221 232 2,991 2,790 
Consolidated statement of total recognised gains and losses
for the year ended 14 September 2002 52 Associated British Foods plc
2002 2001
Note £m £m
Fixed assets
Investment in own shares 13 10 10
Shares in subsidiary undertakings 24 145 145 
155 155 
Current assets
Debtors 15 1,743 1,657 
Investments 16 323 227
Cash at bank and in hand 24 19 
2,090 1,903
Creditors amounts falling due within one year
Short-term borrowings 17 – (5)
Other creditors 18 (1,793) (1,821)
(1,793) (1,826)
Net current assets 297 77
Total assets less current liabilities 452 232
Creditors amounts falling due after one year
Loans 17 (231) –
221 232
Capital and reserves
Called up share capital 20 47 47 
Proﬁt and loss account 21 174 185
Equity shareholders’ funds 221 232
These ﬁnancial statements were approved by the board of directors on 5 November 2002 and were signed on its behalf by:
Harry Bailey Director
John Bason Director
Company balance sheet
at 14 September 2002 Annual Report and Accounts 2002 53
Accounting policies
Basis of preparation
These ﬁnancial statements have been prepared under the historical cost convention as modiﬁed by the revaluation of certain assets,
and in accordance with applicable accounting standards and the Companies Act 1985.
Basis of consolidation
The group accounts comprise a consolidation of the accounts of the company and its subsidiary undertakings, together with the group’s
share of the results and net assets of its joint ventures and associates. The ﬁnancial statements of the company and its subsidiary
undertakings are made up for the 52 weeks ended 14 September 2002, except that, to avoid delay in the preparation of the consolidated
ﬁnancial statements, those of the Australian and New Zealand group and China and Poland are made up to 31 July 2002, and those of
the North American subsidiary undertakings are made up to 31 August 2002.
Acquisitions
The consolidated proﬁt and loss account includes the results of new subsidiary undertakings, joint ventures and associates attributable
to the period since change of control.
Disposals
The results of subsidiary undertakings, joint ventures and associates sold are included up to the dates of change of control. The proﬁt
or loss on the disposal of an acquired business takes into account the amount of any related goodwill previously written off directly to
reserves, or the net amount of goodwill remaining unamortised, as appropriate.
Intangible ﬁxed assets
Intangible ﬁxed assets consist of goodwill arising on acquisitions since 13 September 1998, being the excess of the fair value of 
the purchase consideration of new subsidiary undertakings, joint ventures and associates over the fair value of net assets acquired.
Goodwill is capitalised in accordance with FRS 10 and amortised over its useful economic life, not exceeding 20 years. Goodwill
previously written off against reserves has not been reinstated.
Tangible ﬁxed assets
Tangible ﬁxed assets are carried at their original cost less accumulated depreciation.
Depreciation
Depreciation is provided on the original cost of assets and is calculated on a straight line basis at rates sufﬁcient to reduce them to
their estimated residual value. No depreciation is provided on freehold land or payments on account. Leaseholds are written off over
the period of the lease. The anticipated life of other assets is generally deemed to be not longer than:
Freehold buildings 66 years
Plant, machinery, ﬁxtures and ﬁttings:
– sugar factories 20 years
– other operations 12 years
Vehicles 8 years
Fixed asset investments
Joint ventures and associates are accounted for in the ﬁnancial statements of the group under the equity method of accounting.
Other ﬁxed asset investments in the group’s accounts, and all ﬁxed asset investments in the accounts of the company, are stated 
at cost less amounts written off in respect of any impairment. 54 Associated British Foods plc
Accounting policies continued
Stocks
Stocks are valued at the lower of cost or net realisable value, after making due provision against obsolete and slow-moving items. In the
case of manufactured goods the term ‘cost’ includes ingredients, production wages and production overheads.
Current asset investments
Current asset investments are stated at the lower of cost or market value.
Foreign currencies
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the
balance sheet date, or at the contracted rate as appropriate. The assets and liabilities of overseas operations are translated into sterling
at the rates of exchange ruling at the balance sheet date. The results of overseas operations have been translated at the average rate
prevailing during the year. Exchange differences arising on consolidation are taken directly to reserves. Other exchange differences are
dealt with as part of operating proﬁts.
Group turnover
Turnover represents the net invoiced value of goods and services delivered to customers excluding value added tax.
Pensions
The group has established separately funded pension schemes for the beneﬁt of permanent staff, which vary with employment conditions
in the countries concerned. Net pension costs are charged to income over the expected average remaining service lives of employees. 
Any differences between the charge for pensions and total contributions are included within pension provisions or debtors as appropriate.
Research and development
Expenditure in respect of research and development is written off against proﬁts in the period in which it is incurred.
Leases
All material leases entered into by the group are operating leases, whereby substantially all of the risks and rewards of ownership 
of an asset remain with the lessor. Rental payments are charged against proﬁts on a straight line basis over the life of the lease.
Financial instruments
Forward foreign exchange contracts and currency options are used to hedge forecast transactional cash ﬂows and accordingly, any
gains or losses on these contracts are recognised in the proﬁt and loss account when the underlying transaction is settled. Derivative
commodity contracts are used to hedge committed purchases or sales of commodities and accordingly, any gains or losses on these
contracts are recognised in the proﬁt and loss account in the same accounting period as the underlying purchase or sale. Gains or
losses arising on hedging instruments which are cancelled due to the termination of the underlying exposure are taken to the proﬁt 
and loss account immediately.
Deferred tax
The group has adopted FRS 19 ‘Deferred Taxation’, whereby provision for deferred tax is made on all timing differences that have
originated, but not reversed at the balance sheet date. A deferred tax asset is regarded as recoverable and therefore recognised only
when it is regarded as more likely than not that there will be sufﬁcient future taxable proﬁts. Deferred tax is not discounted.
Adoption of FRS 19 has the effect of increasing the underlying tax charge on proﬁts by £11 million for the year ended 14 September 2002
(2001 – £12 million). It also increases the profit on disposal of businesses in the year ended 15 September 2001 by £12 million.
Shareholders’ funds at 15 September 2001 have been reduced by £91 million. A prior year adjustment has been made and comparative
figures have been restated.  Annual Report and Accounts 2002 55
Notes forming part of the ﬁnancial statements
for the year ended 14 September 2002
1. Segmental analysis
Group turnover Operating proﬁt Capital employed
2002 2001 2002 2001 2002 2001
£m £m £m £m £m £m
Analysis by business
Primary food and agriculture 1,761 1,867 195 172 788 769
Ingredients and oils 800 711 53 42 268 265
Grocery 902 858 50 37 317 319
Retail and packaging 712 574 77 63 344 339
Australia and New Zealand 580 548 12 21 207 217
Inter company sales (232) (255) – – – –
Central costs/capital employed – – (15) (10) (32) (33)
Pension credit – – 25 27 – –
4,523 4,303 397 352 1,892 1,876
Businesses disposed:
Grocery – 33 – 2 – –
Ingredients and oils – 47 – (1) – –
Australia and New Zealand 22 35 (2) (2) – 13
Amortisation of goodwill – – (18) (73) – –
4,545 4,418 377 278 1,892 1,889
Analysis by geography (by origin and destination)
European Union (mainly UK and Ireland) 2,998 2,911 301 246 1,328 1,320
Australia and New Zealand 580 548 12 21 207 217
North America 735 659 42 33 231 234
Elsewhere 233 204 17 25 126 105
Inter company sales (23) (19) – – – –
Pension credit – – 25 27 – –
4,523 4,303 397 352 1,892 1,876
Businesses disposed:
European Union – 50 – 3 – –
North America – 30 – (2) – –
Australia and New Zealand 22 35 (2) (2) – 13
Amortisation of goodwill – – (18) (73) – –
4,545 4,418 377 278 1,892 1,889
Business segment operating proﬁts include a pension charge that reﬂects the regular cost. The difference between this charge and that
required under SSAP 24 is shown as a credit held centrally. Virtually all of the credit arises in the European Union.
The amortisation of goodwill arises in primary food and agriculture £2 million (2001 – £1 million), ingredients and oils £15 million
(2001 – £71 million including an exceptional charge of £62 million), and grocery £1 million (2001 – £1 million). By geography, the
charge arises in the European Union £3 million (2001 – £1 million), North America £13 million (2001 – £71 million) and elsewhere 
£2 million (2001 – £1 million).
The exceptional write down of goodwill in the year ended 15 September 2001 related to an FRS 11 impairment charge based on the
projected cash ﬂows of the food business of SPI in the US, discounted at 12.5%. 
Capital employed comprises tangible fixed assets, interests in joint ventures and associates, current assets (excluding deferred
taxation, cash and investments), creditors (excluding borrowings, tax and dividends) and provisions for liabilities and charges excluding
deferred taxation. 56 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
2. Operating costs
2002 2001
£m £m
Cost of sales (including exceptional items and amortisation of goodwill) 3,420 3,428
Distribution costs 456 423
Administration expenses 299 296
Operating costs 4,175 4,147 
Operating costs are stated after charging:
Staff costs 598 562
Impairment of intangible ﬁxed assets – 62
Amortisation of intangible ﬁxed assets 18 11
Depreciation of tangible ﬁxed assets 149 149
Hire of plant and machinery 7 8 
Rentals payable under property leases 24 21
Research and development 6 7
The remuneration of the auditors in respect of audit services provided to the group during the year was £2.3 million (2001 – £2.2 million)
and £0.2 million (2001 – £0.2 million) in respect of audit services provided to the company. The remuneration of the auditors and their
associates in respect of non-audit services to the company and its UK subsidiaries was £1.4 million (2001 – £3.0 million), including
tax – £0.6 million, transaction due diligence – £0.2 million and project support – £0.3 million.
3. Employees
2002 2001
Average number of employees:
European Union, mainly UK and Ireland 20,952 20,557 
Australia and New Zealand 6,913 7,045 
North America 2,033 2,154 
Elsewhere 5,059 4,233
34,957 33,989 
£m £m
Staff costs – wages and salaries 548 520
– social security costs 38 29
– other pension costs 12 13
598 562  
Details of directors’ remuneration, share options and pension entitlements are shown in the remuneration report on pages 42 to 44.
4. Pension costs
The group has continued to account for pensions in accordance with SSAP 24 and the disclosures given in (a) are those required by
that standard. FRS 17 ‘Retirement Beneﬁts’ was issued in November 2000 but will not be mandatory for the group until the year ended
13 September 2003. Prior to this, phased transitional disclosures are required and are set out in (b).
(a) Associated British Foods pension schemes
The group operates pension schemes, the majority of which are of the deﬁned beneﬁt type. The pension cost charge for the year 
was £12 million (2001 – £13 million). The two main UK schemes provide beneﬁts based on ﬁnal pensionable earnings. The pension
costs in the UK are assessed in accordance with the advice of independent qualiﬁed actuaries using the projected unit method.  Annual Report and Accounts 2002 57
4. Pension costs continued
The last actuarial valuations of the British Sugar Pension Scheme and the Associated British Foods Pension Scheme were carried out 
as at 1 October 2001 and 5 April 1999 respectively. Both valuations used a market related approach under which the actuarial values 
of the assets were taken as their market value at the valuation date. For the British Sugar Pension Scheme, it was assumed that 
the investment return would exceed price inﬂation by 3.25% per annum. For the Associated British Foods Pension Scheme, the
investment return assumption prior to retirement exceeded the price inﬂation assumption by 2.5% per annum and post retirement 
by 2% per annum. In both valuations salary increases were assumed to exceed price inﬂation by 2% per annum.
At the valuation dates the total market value of the two major schemes’ assets was £1,859 million and the value of these assets 
for actuarial valuation purposes represented 126% of the beneﬁts that had accrued to members after allowing for expected future
increases in earnings.
The SSAP 24 charge in respect of the Associated British Foods Pension Scheme in the year ended 14 September 2002 is based 
on the last formal actuarial valuation undertaken in April 1999. Since then the market value of investments has deteriorated. A new
valuation was undertaken as at April 2002, but has yet to be ﬁnalised. The draft report indicates that the scheme remains in surplus 
and there would have been no change to the SSAP 24 charge were this valuation to have been adopted for the preparation of these
accounts. However, in light of the changes in market conditions since April 2002, an informal valuation was conducted as at
September 2002 by the scheme’s actuaries. Although the informal September valuation revealed a further reduction in the surplus
there still remains a modest surplus. If current market conditions prevail, the company will recommence some level of contribution 
to the main UK scheme.
The group also operates pension schemes in Australia and New Zealand, the US and the Republic of Ireland. The charge for the year
is based on recommendations by qualiﬁed local actuaries.
(b) FRS 17 ‘Retirement Beneﬁts’
For the purposes of FRS 17 disclosures, the most recent actuarial valuations referred to above have been updated to 14 September 2002
by an independent qualiﬁed actuary.
The ﬁnancial assumptions used to calculate scheme liabilities under FRS 17 are:
2002 2001
UK Overseas UK Overseas
%% %%
Rate of general increase in salaries 4.25 4.25 4.50 4.50
Rate of increase in pensions in payment 2.25 2.25 2.50 2.50
Rate of increase of deferred pensions 2.25 2.25 2.50 2.50
Discount rate of scheme liabilities 5.50 5.50 6.00 6.00
Inﬂation 2.25 2.25 2.50 2.50
On 30 September 2002 the group’s principal UK deﬁned beneﬁt schemes were closed to new members. As a result, these schemes
have an ageing population. In accordance with FRS 17, the valuation of the schemes’ liabilities has been determined using the
projected unit method. In these circumstances the use of this method can lead to the contribution rate implicit in the current service
cost increasing in future years.  58 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
4. Pension costs continued
The expected rate of return and market values of the assets of the principal schemes at 14 September 2002 were as follows:
UK Overseas
Expected Expected
long-term long-term
rate of Market rate of Market
return value return value
%£m %£m 
Market value of assets 
Equities 6.75 504 6.75 41
Government bonds 4.50 564 4.50 11
Non-government bonds 5.50 496 5.50 –
Property 6.00 62 6.00 2
Other 4.00 35 4.00 1
1,661 55
Present value of scheme liabilities (1,520) (52)
Surplus in the scheme 141 3
Deferred tax (42) (1)
Net pension assets 99 2
The expected rate of return and market values of the assets of the principal schemes at 15 September 2001 were as follows:
UK Overseas
Expected Expected
long-term long-term
rate of Market rate of Market
return value return value
%£m %£m 
Market value of assets 
Equities 7.25 1,150 7.25 35
Government bonds 5.00 66 5.00 10
Non-government bonds 6.00 343 6.00 –
Property 6.50 105 6.50 4
Other 5.00 18 5.00 –
1,682 49
Present value of scheme liabilities (1,326) (40)
Surplus in the scheme 356 9
Deferred tax (107) (2)
Net pension assets 249 7
The group’s net assets and proﬁt and loss account reserve under FRS 17 would have been analysed as follows:
Proﬁt and
Net assets loss reserve
£m £m
Excluding pension assets 3,066 2,768
Pension assets 101 101
Including pension assets 3,167 2,869 Annual Report and Accounts 2002 59
4. Pension costs continued
Had FRS 17 been adopted, the amounts that would have been included in the performance statements would have been as follows:
2002
£m
Current service cost of deﬁned beneﬁt schemes (34)
Past service cost (1)
Total operating charge (35)
An additional current service cost of £4 million arose in connection with the group’s deﬁned contribution pension schemes.
2002
£m
Expected return on pension scheme assets 111
Interest on pension scheme liabilities (80)
Net return included in other ﬁnancial income 31
Actual return less expected return on pension scheme assets (39)
Experience gains and losses arising on the scheme liabilities (53)
Changes in assumptions underlying the present value of the scheme liabilities (130)
Actuarial loss included in the statement of total recognised gains and losses (222)
The movement in the surplus during the year arose as follows:
UK Overseas
2002 2002
£m £m
Surplus at start of year 356 9
Current service cost (30) (4)
Contributions 32
Past service costs (1) –
Other ﬁnancial income 30 1
Actuarial loss (217) (5)
Surplus at end of year 141 3
The experience gains and losses were as follows:
2002
Difference between the expected and actual return on scheme assets
– amount (£m) (39)
– percentage of scheme assets  2.3%
Experience gains and losses on scheme liabilities
– amount (£m) (53)
– percentage of the present value of scheme liabilities 3.4%
Total amount included in statement of total recognised gains and losses  
– amount (£m) (222)
– percentage of the present value of scheme liabilities 14.1% 60 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
5. Investment income
2002 2001
£m £m
Dividends from current asset equity investments – 1
Interest from other current asset investments 54 59
Proﬁt on sale of current asset equity investments 3 6
57 66
6. Interest payable
2002 2001
£m £m
Bank loans and overdrafts – 1
Other loans 22 23
22 24
7. Tax on proﬁt on ordinary activities
2002 2001
£m £m
The charge for the year comprises:
UK – corporation tax at 30% (2001 – 30%) 81 76
Overseas – income and corporation tax 24 28
Joint ventures and associates 2 2
Current tax charge 107 106
UK deferred taxation 10 12
Overseas deferred taxation (22) –
Total tax charge 95 118
Add back:
Tax credit on goodwill amortisation 4 –
Exceptional credit on US deferred tax 23 –
Underlying tax charge 122 118
Tax reconciliation
Proﬁt on ordinary activities before taxation 420 369
Nominal tax charge at UK corporation tax rate 30% (2001 – 30%) 126 111
Lower tax rates on overseas earnings (7) (5)
Expenses not deductible for tax purposes (primarily goodwill) 3 25
Unrelieved overseas losses – 5
Utilisation of losses (2) (18)
Timing differences (11) (12)
Adjustments to tax charge in respect of previous periods (2) –
Current tax charge 107 106
For the purposes of this reconciliation, the tax on proﬁts of joint ventures and associates has been assumed to be entirely current. 
In the absence of any unforeseen circumstances the underlying tax rate is expected to be close to 30%, although this may be affected
by changes in the proportion of proﬁt earned in different tax jurisdictions. Annual Report and Accounts 2002 61
8. Dividends
2002 2001
£m £m
First interim dividend of 4.25p per share (2001 – 4.25p) 34 34 
Second interim dividend of 9.00p per share (2001 – 7.55p) 71 59 
105 93 
The ﬁrst interim dividend was paid on 30 August 2002. The second interim dividend will be paid on 18 February 2003.
9. Earnings per ordinary share
2002 2001
£m £m
Adjusted proﬁt for the ﬁnancial year 305 267
Proﬁts less losses on sale of ﬁxed assets 8 20
Exceptional items 23 (33) 
Amortisation of goodwill (18) (11)
Tax credit on goodwill amortisation 4 –
Proﬁt for the ﬁnancial year attributable to shareholders 322 243 
Adjusted earnings per ordinary share 38.7p 33.8p
Earnings per ordinary share on:
sale of ﬁxed assets 1.0p 2.5p
exceptional items 2.9p (4.1)p
amortisation of goodwill (2.3)p (1.4)p
tax credit on goodwill amortisation 0.5p –
Earnings per ordinary share 40.8p 30.8p 
The weighted average number of ordinary shares in issue during the year was 789 million (2001 – 789 million). The calculation of the weighted
average number of shares excludes the shares held by the Employee Share Option Scheme on which the dividends are being waived.
Adjusted earnings per ordinary share, which exclude the impact of proﬁts less losses on the disposal of ﬁxed assets, exceptional items,
goodwill amortisation and the associated tax credit, is shown to provide clarity to the underlying performance of the group. The diluted
earnings per share calculation takes into account the dilutive effect of share options. The diluted, weighted average number of shares 
is 789 million (2001 – 789 million).
10. Intangible ﬁxed assets – goodwill
£m
Cost at 15 September 2001 263 
Effect of currency changes (15) 
Goodwill arising on acquisitions 236
Disposals –
Cost at 14 September 2002 484
Amortisation at 15 September 2001 84
Effect of currency changes (1)
Provided during year 18 
Amortisation at 14 September 2002 101
Net book value at 14 September 2002 383
Net book value at 15 September 2001 179 62 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
11. Tangible ﬁxed assets
Land Plant Fixtures Payments
and and and on
buildings machinery ﬁttings account Total
£m £m £m £m £m
Cost at 15 September 2001 711 1,565 240 36 2,552 
Effect of currency changes (5) (13) (1) – (19) 
Businesses acquired 9 19 – – 28 
Businesses disposed (3) (20) – – (23)
Additions 3912347(13)196 
Disposals (25)(101)(11)(1)(138) 
Cost at 14 September 2002 726 1,573 275 22 2,596
Depreciation at 15 September 2001 165 874 116 – 1,155 
Effect of currency changes (2) (7) – – (9) 
Provided during year 18 110 21 – 149 
Businesses disposed – (14) – – (14) 
On disposals (5) (90) (11) – (106) 
Depreciation at 14 September 2002 176 873 126 – 1,175
Net book value at 14 September 2002 550 700 149 22 1,421
Net book value at 15 September 2001 546 691 124 36 1,397
2002 2001
£m £m
Analysis of land and buildings at net book value
Freehold 458 460
Long leasehold 56 46 
Short leasehold 36 40
550 546 
The book value of land not amortised in the ﬁnancial statements was £54 million (2001 – £64 million).
12. Capital commitments
There are commitments for capital expenditure by the group of approximately £28 million (2001 – £37 million) for which no provision
has been made in these ﬁnancial statements.
13. Fixed asset investments
Joint Other Own
ventures Associates investments shares Total
£m £m £m £m £m
At 15 September 2001 as previously reported 10 9 2 10 31 
Prior year adjustment (1) – – – (1) 
At 15 September 2001 as restated 9 9 2 10 30 
Effect of currency changes – 1 – – 1 
Additions – 1 – – 1 
Disposals – – (1) – (1)
Share of proﬁt for the year – 1 – – 1 
At 14 September 2002 9 12 1 10 32 Annual Report and Accounts 2002 63
13. Fixed asset investments continued
Details of the principal joint ventures, associates and other investments are given on page 74. Interests in the net assets of joint
ventures include the group’s share of their gross assets of £17 million (2001 – £18 million) and the group’s share of their gross
liabilities of £8 million (2001 – £9 million).
Other investments are stated at cost.
Ordinary shares already issued and subject to option under the Associated British Foods plc 1994 Share Option Scheme are held 
in a separate trust. The trust is funded by an interest free loan from the company, repayable from the proceeds of the exercise of
options granted.
At 14 September 2002 the Scheme held 2,765,753 (2001 – 2,765,753) ordinary shares of the company. The cost of these shares has
been included within ﬁxed asset investments. The market value of the shares at the year end was £16 million (2001 – £12 million).
The Scheme has waived its right to dividends. 
At 14 September 2002 there were options outstanding over 2,400,000 (2001 – 2,459,788) ordinary shares under the 1994 Share 
Option Scheme and over 985,000 (2001 – 947,000) ordinary shares under the Executive Share Option Scheme.
All revenue costs relating to the Schemes have been charged against operating proﬁt.
14. Stocks
2002 2001
£m £m
Raw materials and consumables 185 174
Finished goods and goods for resale 313 295
498 469
15. Debtors
Company Group
2002 2001 2002 2001
(restated)
£m £m £m £m
Trade debtors – – 426 423 
Amounts owed by subsidiary undertakings 1,740 1,643 – –
Other debtors 2 13 59 71 
Prepayments and accrued income 1 1 46 55
Deferred tax – – 21 2
1,743 1,657 552 551
Other debtors of the group at 14 September 2002 include £6 million (2001 – £6 million) receivable after more than one year. 64 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
16. Current asset investments
Company Group
2002 2001 2002 2001
£m £m £m £m
Listed on a recognised stock exchange
– equity investments – – – 4
– other listed investments – – 23 41
Unlisted investments 323 227 1,339 1,150
323 227 1,362 1,195
The market value of the group’s listed equity investments was £nil (2001 – £4 million). Other listed and unlisted investments comprise
interest bearing instruments and deposits. Listed investments include £15 million (2001 – £17 million) quoted on overseas stock exchanges.
17. Loans and short-term borrowings
Company Group
2002 2001 2002 2001
£m £m £m £m
Bank loans and overdrafts – 5 15 32 
Other loans
Wholly repayable within ﬁve years
5
1
⁄ 2% unsecured loan stock 1987/2002 – – – 2 
7
1
⁄ 2% unsecured loan stock 1987/2002 – – – 5
Other unsecured loans 231 – 251 4
Secured loans – – 35 46
Wholly or partly repayable after ﬁve years
10
3
⁄ 4% redeemable debenture stock 2013 (secured) – – 150 150 
231 5 451 239
Creditor analysis
Repayable:
in one year or less – bank loans and overdrafts – 5 15 32
– other loans – – 49 50
– 5 64 82
beyond one year – between one and two years – – 4 2 
– between two and ﬁve years 231 – 233 5 
– in more than ﬁve years – – 150 150
231 – 387 157 
The secured loans are secured by ﬂoating charges over the assets of subsidiary undertakings. Annual Report and Accounts 2002 65
18. Creditors
Company Group
2002 2001 2002 2001
£m £m £m £m
Amounts falling due within one year
Trade creditors – – 271 255
Taxation on proﬁts 4 4 112 108
Other taxation and social security – – 21 14 
Accruals and deferred income 5 1 260 233 
Dividends 71 59 71 59 
Amounts owed to subsidiary undertakings 1,712 1,754 – – 
Amounts owed to joint ventures 1 3 1 3 
1,793 1,821 736 672 
Amounts falling due after one year
Taxation on proﬁts – – 8 10 
19. Provisions for liabilities and charges
Deferred
tax Restructuring Other Total
£m £m £m £m
At 15 September 2001 as previously reported – 12 27 39
Prior year adjustment 91 – – 91
At 15 September 2001 as restated 91 12 27 130
Proﬁt and loss account – charged/(released) 9 5 (5) 9
Utilised – (9) (4) (13)
At 14 September 2002 100 8 18 126
The group’s overall deferred tax position is as follows:
2002 2001
(restated)
£m £m
Fixed asset timing differences 119 93
Other timing differences (40) (4)
79 89
Included in:
Provisions (100) (91)
Debtors 21 2
(79) (89)  
The recoverability of deferred tax assets is supported by the expected level of future proﬁts in the countries concerned. There are other deferred
tax assets totalling £8 million (2001 – £35 million) that have not been recognised on the basis that their future economic beneﬁt is uncertain.
No deferred tax provision has been made in these ﬁnancial statements for the additional tax which may be payable on the remittance
to this country of the group’s share of profits retained by overseas subsidiary undertakings since there is no intention to repatriate
these reserves to the UK in the foreseeable future.
Restructuring provisions relate to the cash costs, including redundancy, associated with the group’s announced reorganisation plans.
Other provisions mainly comprise potential warranty claims arising from the disposal of businesses. 66 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
20. Share capital
Ordinary
Deferred shares of
shares of 5
15
⁄ 22p Nominal
£1 each each value
’000 ’000 £m
Authorised
At 14 September 2002 and 15 September 2001 2,000 1,054,950 62
Issued and fully paid
At 14 September 2002 and 15 September 2001 2,000 791,674 47
The deferred shares became redeemable on 1 August 1997. The amount payable by the company on redemption is the amount paid
up on the deferred shares.
Deferred shares carry no voting rights and have no rights to dividends or other income distributions. In the event of a winding up,
repayment in respect of the deferred shares ranks after repayment of amounts paid up on the ordinary shares of the company. 
The deferred shares are entitled to repayment of amounts paid up, but have no entitlement to any surplus.
21. Reserves
Group Company
Group Group proﬁt proﬁt
revaluation other and loss and loss
reserve reserves account account
£m £m £m £m
At 15 September 2001 as previously reported 3 173 2,658 185
Prior year adjustment – – (91) –
At 15 September 2001 as restated 3 173 2,567 185 
Effect of currency changes – – (21) –
Tax on effect of currency changes – – 5 –
Proﬁt for the year – – 217 (11)
At 14 September 2002 3 173 2,768 174
As permitted by Section 230(4) of the Companies Act 1985, no proﬁt and loss account has been presented for the company.
The cumulative amount of goodwill written off directly to reserves as a result of acquisitions made in earlier ﬁnancial periods is £527 million
(2001 – £527 million).
22. Contingent liabilities
Litigation and other proceedings against companies in the group are not considered material in the context of these ﬁnancial statements.
Group companies have provided guarantees in the ordinary course of business amounting to £37 million (2001 – £39 million). 
The contingent liabilities of the company at 14 September 2002 were £32 million (2001 – £35 million). Annual Report and Accounts 2002 67
23. Leases
The group has minimum annual commitments under non-cancellable operating leases as follows:
Operating leases which expire: Within Two to Over
one year ﬁve years ﬁve years Total
£m £m £m £m
Land and buildings 5 3 20 28
Other 14 –5
At 14 September 2002 6 7 20 33 
Land and buildings 4 2 19 25
Other 1 4 – 5 
At 15 September 2001 5 6 19 30 
24. Shares in subsidiary undertakings
£m
At 14 September 2002 and 15 September 2001 145
Investments in subsidiary undertakings are shown at cost less amounts written off. A list of the principal trading subsidiary undertakings
is given on page 74. None of the companies shown is a direct subsidiary undertaking of Associated British Foods plc.
The entire share capital of the companies listed is held within the group except where percentages are shown. These percentages give
the group’s ultimate interest and therefore allow for the position where subsidiary undertakings are owned by partly owned intermediate
subsidiary undertakings.
25. Cash ﬂow from operating activities
2002 2001
£m £m
Operating proﬁt 370 271 
Amortisation of goodwill 18 73 
Depreciation 149 149 
(Increase)/decrease in working capital
– stocks (18) 8
– debtors (13) (31)
– creditors 27 (16) 
European Commission ﬁne – (27)
Other provisions (10) – 
Net cash from operating activities 523 427  68 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
26. Acquisitions and disposals
Acquisitions Disposals
2002 2001 2002 2001
£m £m £m £m
Net assets 
Goodwill – – – 1
Tangible ﬁxed assets 28 17 9 93 
Joint ventures – – – 2 
Fixed asset investments – – – 3 
Investments 5 – – –
Stocks 16 23 2 34
Debtors 1 8 – 38 
Cash at bank and in hand – 4 – – 
Creditors (12) (12) – (31)
Bank overdrafts – – – (1) 
Loans and ﬁnance leases (5) (17) – – 
Minority interests (2) (3) – – 
Net assets acquired/disposed 31 20 11 139
Goodwill on acquisitions/written back 236 105 – 5
Provisions made – – 5 3
Proﬁt on sale – – – 17
Total consideration 267 125 16 164 
Satisﬁed by
Cash 267 125 16 141
Debtors/deferred consideration – – – 23
Net cash
Cash consideration 267 125 16 141 
Deferred consideration brought forward received in the year – – 18 –
Cash and overdrafts acquired/disposed – (4) – 1 
267 121 34 142 
The principal acquisitions in the year were Mazola – £235 million, Crusha – £11 million and SPP Ingredients – £12 million, all of which
were asset purchases.
There have been no material fair value adjustments on acquisitions.
Costs associated with acquisitions and disposals are included within cash consideration.
27. Reconciliation of net cash ﬂow to movement in net funds
2002 2001
£m £m
Increase in cash 47 32
Management of liquid resources 164 76 
Net increase in borrowings (216) (6)
Change in net funds resulting from cash ﬂows (5) 102 
Effect of currency changes 4 (5)
On acquisition of subsidiary undertakings – (17)
Other – (10)
Movement in net funds (1) 70 
Opening net funds 1,051 981
Closing net funds 1,050 1,051 Annual Report and Accounts 2002 69
28. Analysis of net funds
Acquisition
At of At
15 September Cash subsidiary Exchange 14 September
2001 ﬂow undertakings adjustments 2002
£m £m £m £m £m
Cash at bank and in hand 95 47 – (3)  139
Short-term borrowings (82) 15 – 3 (64)
Investments 1,195 164 5 (2)  1,362
Loans over one year (157) (231) (5) 6 (387)
1,051 (5) – 4 1,050
29. Financial instruments
Disclosures on ﬁnancial risk management, treasury policies and use of ﬁnancial instruments are also included in the Finance Director’s
report. Short-term debtors and creditors have been excluded from the following disclosures except for the analysis of net currency exposures.
Interest rate risk proﬁle of ﬁnancial assets
The interest rate proﬁle of the ﬁnancial assets of the group was:
Fixed rate
ﬁnancial assets
Financial Weighted
assetsFloatingFixed Weightedaverage
on which rate rate average period for
no interest ﬁnancial ﬁnancial interest which rate
is received assets assets Total rate is ﬁxed
£m £m £m £m % Months
Currency
Sterling 2 1,251 7 1,260 4.1 38
Australian dollar – 76 – 76 – –
US dollar – 45 – 45 – –
Euro 1 74 – 75 – –
Other – 52 – 52 – –
At 14 September 2002 3 1,498 7 1,508 4.1 38
Currency
Sterling 5 1,085 28 1,118 5.2 46
Australian dollar 1 35 – 36 – – 
US dollar – 23 – 23 – – 
Euro – 72 9 81 3.7 78 
Other – 34 – 34 – – 
At 15 September 2001 6 1,249 37 1,292 4.8 53 
The ﬂoating rate ﬁnancial assets comprise cash, short-term deposits and other ﬁnancial instruments, bearing interest ﬁxed in advance,
based on local prevailing rates. 70 Associated British Foods plc
Notes forming part of the ﬁnancial statements continued
29. Financial instruments continued
Interest rate risk proﬁle of ﬁnancial liabilities
The interest rate proﬁle of the ﬁnancial liabilities of the group was:
Fixed rate
ﬁnancial liabilities
Weighted
FloatingFixed Weightedaverage
rate rate averageperiod for
ﬁnancial ﬁnancial interest which rate
liabilities liabilities Total rate is ﬁxed
£m £m £m % Months
Currency
Sterling 5 150 155 10.8 129
US dollar 232 – 232 – –
Euro 1 – 1 – –
Other 63 – 63 – –
At 14 September 2002 301 150 451 10.8 129
Currency
Sterling 18 157 175 10.6 134 
Euro 16 – 16 – – 
Other 47 1 48 3.0 15 
At 15 September 2001 81 158 239 10.5 134 
The ﬂoating rate ﬁnancial liabilities comprise short-term bank borrowings bearing interest ﬁxed in advance, based on local prevailing rates.
Currency exposure
The analysis below shows the net monetary assets and liabilities of the group that are not denominated in their functional currency and
therefore give rise to exchange gains and losses in the proﬁt and loss account. The amounts shown below take into account the effect
of forward currency contracts.
Net foreign currency monetary assets/(liabilities)
Functional currency of group operation
Sterling Euro Other Total
£m £m £m £m
Sterling – (5) – (5)
US dollar 16 – 7 23 
Euro 49 – (4) 45 
Other 5 5 – 10 
At 14 September 2002 70 – 3 73 
Sterling – (4) (1) (5) 
US dollar 2 – 12 14 
Euro 47 – – 47 
Other 1 (3) – (2) 
At 15 September 2001 50 (7) 11 54  Annual Report and Accounts 2002 71
29. Financial instruments continued
Borrowing facilities
The group has various borrowing facilities available to it. The undrawn committed facilities available at 14 September 2002 in respect
of which all conditions precedent have been met, were as follows:
2002 2001
£m £m
Expiring within one year 9 20 
Expiring between one and two years – – 
Expiring thereafter – –
9 20
Fair value
The estimated fair values of the group’s ﬁnancial instruments are summarised below:
2002 2001
Carrying Estimated Carrying Estimated
amount fair value amount fair value
£m £m £m £m
Primary ﬁnancial instruments held or issued to ﬁnance the group’s operations
Cash 139 139 95 95 
Fixed asset investments 1 1 2 2 
Current asset investments 1,362 1,367 1,195 1,209 
Debtors receivable after one year 6 6 6 6
Loans due within one year (64) (64) (82) (82)
Loans due after one year (387) (444) (157) (207)
Derivative ﬁnancial instruments held to manage currency and commodity exposure
Forward foreign exchange contracts – (4) – – 
Currency options – – – (2) 
The values of the group’s current asset investments and loans due after one year are their market values.
The values of foreign exchange contracts and currency options are the estimated amounts which the group would expect to pay or receive
on the termination of these contracts.
Unrecognised gains and losses on hedges
Net gains/
Gains Losses (losses)
£m £m £m
At 15 September 2001 2 (4) (2) 
Arising in previous years and recognised during the year (2) 4 2 
Arising before 15 September 2001 and not recognised during the year – – – 
Arising in the year and not recognised during the year – (4) (4) 
At 14 September 2002 – (4)  (4)
Expected to be recognised
In one year or less –(4) (4)
In later years –––
– (4)  (4) 72 Associated British Foods plc
29. Financial instruments continued
Unrecognised gains and losses on hedges
Net gains/
Gains Losses (losses)
£m £m £m
At 16 September 2000 11 – 11 
Arising in previous years and recognised during the year (11) – (11)
Arising before 16 September 2000 and not recognised during the year – – – 
Arising in the year and not recognised during the year 2 (4) (2) 
At 15 September 2001 2 (4) (2) 
Expected to be recognised
In one year or less 2 (4) (2) 
In later years – – – 
2 (4) (2) 
30. Holding company information
The largest group in which the results of the company are consolidated is that headed by Wittington Investments Limited, the accounts
of which are available at Companies House, Crown Way, Cardiff, CF14 3UZ. It is the ultimate holding company and is incorporated in
Great Britain and registered in England.
At 14 September 2002 Wittington Investments Limited together with its subsidiary undertaking, Howard Investments Limited, held
431,515,108 ordinary shares (2001 – 431,515,108) representing in aggregate 54.5% (2001 – 54.5%) of the total issued ordinary
share capital of Associated British Foods plc. 
31. Related party transactions
The group’s related parties, as defined by Financial Reporting Standard 8, the nature of the relationship and the extent of the
transactions with them, are summarised below:
Sub 2002 2001
note £’000 £’000
Management charge from Wittington Investments Limited, principally in respect
of directors and secretarial staff of ABF paid by Wittington 1 190 186
Charges to Wittington Investments Limited in respect of services provided by the 
company and its subsidiary undertakings 1 (53) (59)
Dividends paid by ABF and received in a beneﬁcial capacity by:
(i) Trustees of The Garﬁeld Weston Foundation 2 3,593 3,214
(ii) Directors of Wittington Investments Limited who are not Trustees 
of the Foundation 618 589
(iii) Directors of the company who are not Trustees of the Foundation and are not
directors of Wittington Investments Limited 3 4 4
(iv) a member of the Weston family employed within the ABF group 4 344 328
Notes forming part of the ﬁnancial statements continued Annual Report and Accounts 2002 73
31. Related party transactions continued
Sub 2002 2001
note £’000 £’000
Sales to fellow subsidiary undertakings on normal trading terms 5 5 7  
Amounts due from fellow subsidiary undertakings 5 – 1  
Sales to joint ventures and associates on normal trading terms 6 33 55  
Purchases from joint ventures and associates on normal trading terms 6 1 9 
Amounts due from joint ventures and associates 6 2 6 
Amounts due to joint ventures and associates 6 3 3
Sub notes
1. At 14 September 2002 Wittington Investments Limited together with its subsidiary undertaking, Howard Investments, held
431,515,108 ordinary shares (2001 – 431,515,108) representing in aggregate 54.5% (2001 – 54.5%) of the total issued ordinary
share capital of the company.
2. The Garﬁeld Weston Foundation (‘the Foundation’) is an English charitable trust, established in 1958 by the late W Garﬁeld
Weston. The Foundation has no direct interest in the company, but as at 14 September 2002 held 683,073 shares in Wittington
Investments Limited representing 79.2% of that company’s issued share capital and is, therefore, the company’s ultimate
controlling party. At 14 September 2002, Trustees of the Foundation comprised four of the late W Garﬁeld Weston’s children 
and ﬁve of the late Garry H Weston’s children.
3. Details of the directors are given on pages 34 and 35. Their beneﬁcial interests, including family interests, in the company and its
subsidiary undertakings are given on page 45. Directors’ remuneration, including share options, is disclosed on pages 42 to 44.
4. A member of the Weston family who is employed by the group and is not a director of the company or Wittington Investments
Limited and is not a Trustee of the Foundation.
5. The fellow subsidiary undertaking is Fortnum & Mason PLC.
6. Details of the group’s principal joint ventures and associates are set out on page 74.
32. Post balance sheet events
On 20 September 2002, the minority shareholdings in George Weston Foods in Australia were acquired at a cost of £58 million. 
The company was subsequently delisted from the Australian Stock Exchange on 27 September 2002.
On 8 October 2002, we announced the acquisition of the food and beverage business, comprising Ovaltine and associated brands,
from Novartis for £171 million. Net tangible assets are estimated to be £45 million at completion. Completion will follow the grant 
of appropriate regulatory approvals. 74 Associated British Foods plc
Manufacturing activities Country of incorporation
AB Enzymes GmbH Germany
AB Enzymes Oy Finland
AB Technology Limited UK
ABF Grain Products Limited UK
Abitec Corporation US
ABNA Limited UK
ACH Food Companies Inc US
Allied Foods Co Limited (81%) New Zealand
Allied Glass Containers Limited UK
Allied Grain Limited UK
Allied Technical Centre Limited UK
British Sugar (Overseas) Limited UK
British Sugar plc UK
Cereform Limited (95%) UK
Cukrownia Glinojeck SA (53%) Poland
Fishers Agricultural Holdings Limited UK
Food Investments Limited UK
Foods International SA France
George Weston Foods Limited (81%) Australia
Germains (Ireland) Limited Republic of Ireland
Germains (Poland) Sp zoo (65%) Poland
Grosvenor Marketing Limited US
Guangxi Bo hua Food Company (71%) China
Guangxi Boqing Food Co. Limited (60%) China
Haugen Gruppen Denmark AS Denmark
Henan Lianhua – BSO Pharmaceutical Co. Limited (57%) China
Jacksons of Piccadilly Limited UK
Jordan Bros (NI) Limited UK
Liaoning Liaohe Aimin Feed Company Limited (55%) China
Manufacturing activities Country of incorporation
Liaoning Liaohe Yingpeng Feed Company Limited (55%) China
Nambarrie Tea Company Limited UK
R Twining & Co. Limited US
R Twining & Company Limited UK
Seed Systems Incorporated US
Shanghai ABN Huinong Feed Company Limited (60%) China
SPCA Barcroft SA France
SPI Pharma Inc US
SPI Polyols Incorporated US
SugarPol (Torun) Sp. zoo (72%) Poland
The Ryvita Company Limited UK
Retailing activities Country of incorporation
Primark Republic of Ireland
Primark Stores Limited UK
Investment and other activities Country of incorporation
Beauvallet Investments Limited Jersey, Channel Islands
Eastbow Securities Limited UK
Serpentine Securities Limited UK
Soublier Investments Limited Jersey, Channel Islands
Talisman (Guernsey) Limited Guernsey, Channel Islands
Group interest is 100% except where indicated.
British Sugar (Overseas) Limited operates subsidiary undertakings 
and joint ventures in Europe and Asia. Other than this company,
each subsidiary undertaking operates mainly in its country 
of incorporation.
Principal subsidiary undertakings
The group’s interest in subsidiary undertakings are all equity investments with the exception of a preference share interest in
British Sugar plc held by Beauvallet Investments Limited and Soublier Investments Limited.
Investments
Issued ordinary share capital
Country of incorporation Total Group %
Principal joint ventures and associates
C Czarnikow Sugar Limited UK £1,000,000 42
Chiltern Bakeries Limited UK £100 44
Getec Guanabara Quimica Industrial SA Brazil BRR14,254,370 20
Harper-Love Adhesives Corporation US US$912,200 50
Mauri Products Limited UK £1,375,001 50
Murray Bridge Bacon Pty Limited Australia A$11,040,210 20
New Food Coatings Pty Limited Australia A$150,000 50
Roal Oy Finland €3,195,572 50
WA Country Bakers Pty Limited Australia A$1,000,000 50
Yeast Products Company Limited Republic of Ireland €1,015,796 30
There is no signiﬁcant loan capital in any of the joint ventures or associates. Each joint venture and associate carries out manufacturing
and food processing activities and operates mainly in its country of incorporation. Annual Report and Accounts 2002 75
Progress report
Saturday nearest to 15 September 1998 1999 2000 2001 2002
£m £m £m £m £m
Turnover 4,195 4,299 4,406 4,418 4,545
Operating proﬁt before exceptional items
and amortisation of goodwill 316 326 340 351 395
Exceptional items (19) (84) (130) – –
Amortisation of goodwill – (5) (6) (73) (18)
Proﬁt less losses on sale of properties (3) 4 8 20 8
Proﬁt less losses on sale or termination
of businesses – – – 29 –
Investment income 119 84 61 66 57
Proﬁt on ordinary activities before interest 413 325 273 393 442
Interest payable (22) (25) (26) (24) (22)
Proﬁt on ordinary activities before taxation 391 300 247 369 420
Tax on proﬁt on ordinary activities (124) (115) (111) (118) (95)
Proﬁt on ordinary activities after taxation 267 185 136 251 325
Minority interests (2) (1) 2 (8) (3)
Proﬁt for the ﬁnancial year 265 184 138 243 322
Earnings per share 29.6p 21.4p 17.5p 30.8p 40.8p
Adjusted earnings per share 32.0p 31.3p 33.1p 33.8p 38.7p
The ﬁgures for 1998 to 2000 have not been restated to reﬂect the adoption of FRS 19 ‘Deferred Taxation’. 76 Associated British Foods plc
Notice is hereby given that the sixty-seventh annual general meeting of the company will be held at The Royal Garden Hotel, 
2-24 Kensington High Street, London W8 4PT on Thursday 5 December 2002 at 11.00 am to transact the following business:
Ordinary business
Resolution 1
To receive the accounts and the reports of the directors and the auditors thereon for the period ended 14 September 2002.
Resolution 2
To re-elect GG Weston as a director.
Resolution 3
To re-elect JG Bason as a director.
Resolution 4
To re-elect MG Adamson as a director.
Resolution 5
To elect MR Alexander as a director.
Resolution 6
To re-appoint KPMG Audit Plc as auditors of the company to hold ofﬁce from the conclusion of this meeting until the conclusion of the
next general meeting at which accounts are laid before the shareholders, and to authorise the directors to determine their remuneration.
Special business
To propose and, if thought ﬁt, to pass the following resolution as an ordinary resolution:
Resolution 7
That the directors be and they are hereby generally and unconditionally authorised in accordance with Section 80 of the Companies
Act 1985 to exercise all the powers of the company to allot relevant securities (as deﬁned in Section 80(2) of that Act) up to a maximum
of 263 million ordinary shares of 5
15
⁄ 22p each provided that this authority shall expire on 4 December 2007, save that the company
shall be entitled to make offers or agreements before the expiry of such authority which would or might require relevant securities 
to be allotted after such expiry and the directors shall be entitled to allot relevant securities pursuant to any such offer or agreement
as if this authority had not expired; and all unexercised authorities previously granted to the directors to allot relevant securities be
and are hereby revoked.
Notice of meeting Annual Report and Accounts 2002 77
To propose the following resolution as a special resolution:
Resolution 8
That the directors be and they are hereby empowered pursuant to Section 95 of the Companies Act 1985 to allot equity securities 
(as defined in Section 94(2) of that Act) for cash pursuant to the authority conferred by Resolution 7 above as if Section 89(1) 
of that Act did not apply to any such allotment provided that this power shall be limited to:
(i) the allotment of equity securities in connection with a rights issue, open offer or other offer of securities in favour of the holders 
of ordinary shares on the register of members at such record date(s) as the directors may determine where the equity securities
respectively attributable to the interests of the ordinary shareholders are proportionate (as nearly as may be) to the respective
numbers of ordinary shares held by them on any such record date(s), but subject to such exclusions or other arrangements as 
the directors may deem necessary or expedient to deal with fractional entitlements or legal or practical problems arising under 
the laws of any overseas territory or the requirements of any regulatory body or stock exchange or by virtue of shares being
represented by depositary receipts or any other matter whatever; and
(ii) the allotment (otherwise than pursuant to sub-paragraph (i) above) to any person or persons of equity securities up to an
aggregate of 39 million ordinary shares of 5
15
⁄ 22p each; 
and shall expire upon the date of the next annual general meeting of the company after the passing of this resolution or 31 December 2003,
whichever is sooner, save that the company shall be entitled to make offers or agreements before the expiry of such power which would
or might require equity securities to be allotted after such expiry and the directors shall be entitled to allot equity securities pursuant
to any such offer or agreement as if the power conferred hereby had not expired.
By order of the board
Paul Lister
Secretary
Weston Centre, Bowater House,
68 Knightsbridge, London SW1X 7LQ
Registered in England and Wales
Company No. 293262
5 November 2002  78 Associated British Foods plc
1. Resolutions number 2 to 5
In accordance with the Articles of Association, all directors who held ofﬁce at the time of the two preceding annual general meetings,
and who did not put themselves forward for re-election should do so. The Combined Code of best practice recommends that 
all directors should be required to submit themselves for re-election at least once every three years. Mr Bailey will retire with
effect from the end of the meeting and will not be putting himself forward for re-election. In accordance with the Articles of
Association, MR Alexander having been appointed a director since the last annual general meeting, is required to retire at this
meeting and, being eligible, offers himself for election.
2. Resolutions number 7 and 8
The Companies Act 1985 prevents directors allotting unissued shares without the authority of shareholders in general meeting. 
At the annual general meeting held in December 2001 shareholders gave the directors a general authority to allot shares up 
to a limit not exceeding one third of the ordinary shares in issue. The authority is valid for the maximum period of five years 
as permitted by that Act and expires in December 2006. The directors, however, propose to renew this authority every year asking, 
on each occasion, for the authority to be granted for a further period of ﬁve years. Resolution number 7 will authorise the directors 
to allot substantially all of the present unissued ordinary share capital, which represents approximately 25% of the company’s
authorised share capital, and approximately 33% of the company’s issued ordinary share capital at 5 November 2002, at any
time within the next ﬁve years. The proposed renewal of the authority should not be taken as an indication that the directors have
any current plans to make an issue of shares.
Where shares are allotted pursuant to a general authority as provided in resolution number 7 and shareholders are required 
to pay for them in cash, that allotment is subject to Section 89 of the Companies Act, which requires new shares to be offered 
first to existing shareholders in proportion to their existing holdings. There may, however, be circumstances where directors wish 
to allot shares for cash other than by way of rights issue, open offer or other offer of securities and this cannot be done unless
shareholders have ﬁrst waived their pre-emption rights. Resolution number 8 asks shareholders to do this by allowing the directors 
to allot for cash (i) by way of a rights issue, open offer or other offer of securities to all shareholders (subject to certain exclusions)
and (ii) up to 5% of the company’s present issued ordinary share capital as at 5 November 2002 to persons other than existing
shareholders. By setting the 5% limit, interests of existing shareholders are protected, as their interest in the company cannot,
without their consent, be reduced by more than 5% by the issue of new shares for cash to new shareholders.
3. The company, pursuant to Regulation 41 of the Uncertiﬁcated Securities Regulations 2001, speciﬁes that only those shareholders
registered in the register of members of the company at 6.00 pm on Tuesday 3 December 2002 shall be entitled to attend 
or vote at the annual general meeting in respect of the number of shares registered in their name at that time. Changes to entries 
on the register after 6.00 pm on Tuesday 3 December 2002 shall be disregarded in determining the rights of any person to attend 
or vote (and the number of votes they may cast) at the meeting.
4. A member entitled to attend and vote at the meeting may appoint a proxy (who need not be a member of the company) to attend
and, on a poll, to vote in his/her place. The instrument appointing a proxy should be deposited at the company’s registered ofﬁce 
not later than 11.00 am on Tuesday 3 December 2002.
5. No director has a contract of service with the company which is not determinable within one year without payment of compensation 
or which contains provisions for predetermined compensation on termination of an amount, which equals or exceeds one year’s
salary and beneﬁts in kind.
6. The register of directors’ interests in the ordinary shares of the company will be available for inspection during normal business
hours on any weekday (Saturdays excepted) from the date of this notice until the date of the annual general meeting at the
registered ofﬁce of the company and at The Royal Garden Hotel 15 minutes prior to and during the meeting.
Notes Annual Report and Accounts 2002 79
Shareholders are asked to use the Palace Suite entrance from the forecourt. Those requiring the lift should descend to the Palace Suite
from the main hotel reception.
Directions to the annual general meeting 80 Associated British Foods plc
Associated British Foods plc
Registered ofﬁce Weston Centre
Bowater House
68 Knightsbridge
London SW1X 7LQ
Company registered in England, number 293262
Secretary Paul Lister
Registrars and transfer ofﬁce Lloyds TSB Registrars
The Causeway
Worthing
West Sussex BN99 6DA
Auditors KPMG Audit Plc
Chartered Accountants
Bankers Bank of Scotland
Barclays Bank plc
Lloyds TSB Bank plc
The Royal Bank of Scotland plc
Timetable First interim dividend paid 30 August 2002
Second interim dividend to be paid 18 February 2003
Annual general meeting 5 December 2002
Interim results to be announced April 2003
Internet site http://www.abf.co.uk
Company directory Designed and produced by Sheppard Day Associated British Foods plc Weston Centre, Bowater House, 68 Knightsbridge, London SW1X 7LQ T 020 7589 6363 F 020 7584 8560 I www.abf.co.uk
Associated British Foods plc Annual Report and Accounts 2002