THE BELHAVEN GROUP plc
Annual Report and Accounts 2005
THE BELHAVEN GROUP plc  Annual Report and Accounts 2005 Contents
Highlights 1 
Chairman’s Statement 2
Chief Executive’s Review 6
Questions and Answers 12
Financial Review 16 
Board of Directors 18
Senior Executive Team 19
Directors’ Report 20
Corporate Governance Statements 22
Statement of Social, Environmental
and Ethical Responsibility 27
Directors’ Remuneration Report 29
Independent Auditors’ Report 35
Consolidated Profit and Loss Account 36
Consolidated Statement of Total
Recognised Gains and Losses 37
Consolidated Note of Historical
Cost Profits and Losses 37
Balance Sheets 38
Consolidated Cash Flow Statement 39
Statement of Accounting Policies 40
Notes to the Accounts 42
Notice of Annual General Meeting 58
Advisors and Shareholder Information 60 Design: mckinstriewilde.co.uk
“Here’s to t 2001
7,457
2002
9,171
2003
10,828
2004
14,231
2005
17,428
2001
8,783
2002
10,889
2003
13,034
2004
16,604
2005
20,459
2001
36,178
2002
40,860
2003
48,454
2004
80,411
2005
94,880
2001
24.4
2002
30.4
2003
34.8
2004
37.2
2005
43.7
Annual Report and Accounts 2005 1
HIGHLIGHTS
•
Operating profit up 23.2% from £16.60m to £20.46m
•
Pre-tax profit up 22.5% from £14.23 to £17.43m 
•
Earnings per share up 17.5% from 37.2p to 43.7p 
•
Net assets up 18.0% from £80.41 to £94.88m
•
Dividend per share up 10.3% from 11.20p to 12.35p
Belhaven has enjoyed another
excellent year of strong growth.
Operating profit (£’000) Profit before tax (£’000) Net assets (£’000) EPS (pence)
The results for 2005 are for the 53 week period ended 3 April 2005, compared
to 52 weeks in the previous year(s). Except as stated, none of the figures quoted
in this Report have been adjusted on a pro-rata basis. “We are delighted to report record 
results, with pre-tax profit up 22.5%
and net assets up 18.0%.” RESULTS
The Board of Belhaven is delighted to report another set of record
results, comfortably ahead of market expectations, with excellent
progress having been achieved in both of our operating divisions.
Pre-tax profit increased by 22.5 per cent from £14.23 million to
£17.43 million in the 53 week period to 3 April 2005. Turnover was
up 20.5 per cent from £94.96 million to £114.44 million.
Earnings per share increased by 17.5 per cent from 37.2p to 43.7p
despite the dilutive impact of the additional equity which was raised
in July 2003. The effective tax rate in the period was 25.6 per cent
(2004: 29.0 per cent).
Belhaven has now achieved increased sales and operating profits
for fifteen consecutive years.
DIVIDENDS
The Board recommends a final dividend of 8.00p per share, making
a total of 12.35p for the year, an increase of 10.3 per cent on the
dividend of 11.20p for the previous year. The dividend is covered
3.5 times. The final dividend will be paid on 1 August 2005 to
shareholders on the register on 1 July 2005.
INVESTMENT
Capital expenditure in the financial year, net of disposals,
amounted to £29.66 million (2004: £28.82 million). Of this total
£25.71 million was invested into the expansion and development
of the pub estate. Further details of the pub estate are included in
the Chief Executive’s Review (page 8, table 2).
PUB ESTATE REVALUATION
In accordance with the provisions of FRS15, the Board instructed
Graham & Sibbald, 18 Newton Place, Glasgow, G3 7PY, to conduct
a valuation of the Group’s pub estate as at 3 April 2005. The estate,
which was previously valued by Graham & Sibbald at 30 March
2003, has been valued at £141.37 million which represents a
surplus over book value of £4.43 million. This surplus has been
credited to revaluation reserve in the balance sheet.
NET ASSETS AND GEARING
In the 53 week period the net assets of Belhaven have risen by
18.0 per cent from £80.41 million to £94.88 million, after
incorporating the pub estate revaluation surplus. Gearing at the
end of the year was 54.9 per cent (excluding trade loans sold on
to the Bank of Scotland), compared to 46.0 per cent at the start
of the financial year. Interest cover was 6.7 times, more than twice
our bank covenant of 3 times.
BANKING FACILITIES
Since the balance sheet date, revised banking arrangements have
been agreed with the Bank of Scotland with whom we have
enjoyed a close business relationship over many years. Full details
of these arrangements, which provide the Group with ample
headroom in the funding required for our expansion programme,
are disclosed in the Financial Review on page 16.
At the present time we have hedged our interest rate risk on
£20 million of our borrowings, over periods of between six and
eighteen months.
INTERNATIONAL FINANCIAL REPORTING STANDARDS
With effect from financial year to 2 April 2006, the Group’s financial
statements will be prepared in accordance with International
Financial Reporting Standards. Currently, we report in accordance
with UK Generally Accepted Accounting Principles (GAAP).
Ron Robson deals with the material points of difference in the
two sets of guidelines, insofar as we believe that they will affect
Belhaven’s accounts, in the Financial Review on page 17.
REGULATORY ISSUES
In common with many other industries, the Scottish licensed trade
is subjected to increasing regulation with new laws and guidelines
emanating from Brussels, Westminster, Holyrood and from many of
the 32 licensing boards in Scotland.
The most potentially impactful changes which we require to
address are the proposed ban on smoking in licensed premises in
Scotland with effect from April 2006 and the reform of Scottish
licensing law which is not expected to be implemented until
2007 at the earliest.
CHAIRMAN’S STATEMENT
Annual Report and Accounts 2005 3
Angus Meldrum
Chairman “Belhaven has a clear strategy which 
has been consistently and effectively 
applied for many years.” Annual Report and Accounts 2005 5
THE FUTURE
Belhaven has a clear strategy which has been consistently and
successfully applied for many years; our primary objective remains
to grow our position of importance in the Scottish licensed trade,
within the framework of an integrated regional brewer.
Despite the uncertainty inevitably created by the proposed ban on
smoking in licensed premises in Scotland, we remain confident that
our strategy will continue to deliver success for the business and all
its stakeholders. We will be adapting our pub estate to optimise our
position within the context of the new regulatory framework.
The financial results of Belhaven over the past fifteen years
underline the wisdom of our strategy and the consistency of
performance which has become the hallmark of the Group. There
is no doubt that one of the strengths of this business is the ability
of the management team.
Angus Meldrum
Chairman
6 June 2005 
CHAIRMAN’S STATEMENT
Please refer to pages 13 to 15 where our executive management
team give their views on the opportunities and threats to our
business as a result of regulatory change.
BOARD CHANGES
Chris Greig retired from the Board on 16 July 2004 after serving
nine years as a non-executive Director including four as Chairman
of the Group. I succeeded Chris as non-executive Chairman on that
date and I would like to thank my colleagues for their help in
making the change as seamless as possible.
On behalf of all Belhaven shareholders, directors and employees I
extend our gratitude to Chris for his valuable input to the Board
over these nine years. His advice was always wise, prudent and
pertinent and he left Belhaven with our respect and appreciation.
David Morrison, who was Belhaven’s Group Finance Director since
the Company was floated in 1996, retired from the business on the
last working day of the financial year.David has given outstanding
service to Belhaven over a period of some twenty seven years, in
two spells, and I thank him for his pivotal contribution to the
evolution of Belhaven during that time. I send best wishes to David,
and his partner Suzanne, for a long, happy and healthy retirement.
I extend a warm welcome to David’s successor as Group Finance
Director, Ron Robson who joined the Group on 28 February 2005
and was appointed to the Board on 4 April 2005. I am confident
Ron will play a key role in the management of Belhaven for many
years to come.
PEOPLE
The Board wishes to thank staff at all levels of the Group for the
skill, commitment, dedication and tenacity which they consistently
display in the conduct of Belhaven’s business. These qualities
continue to underpin the success of the Group. “We have achieved all the objectives
set for the business in the past year.”
Belhaven Report FRONT  1/6/05  9:30 AM  Page 6 Annual Report and Accounts 2005 7
CHIEF EXECUTIVE’S REVIEW
OVERVIEW
Belhaven has achieved all the objectives set for the business in the
past year and has further strengthened its position as an important
strategic force in the Scottish licensed trade.
In the past two years we have achieved a significant rate of
growth. Turnover has increased by 44.9 per cent, profit before
tax by 60.9 per cent and the pub estate has been expanded from
189 to 270 units. Moreover, our three key brands Belhaven Best,
Tennent’s Lager and Stella Artois (the latter two being purchased
from InBev) have spearheaded considerable gains in market share
of the Scottish licensed trade for our drinks business.
STRATEGY
Belhaven is committed to the classic structure of an integrated
regional brewer. We continue to operate and develop our
activities in brewing, drinks distribution, pub retailing and
tenanted estate management.
We endeavour to create a business which is a fusion of attractive
pubs and popular beers, managed by people who have the talent,
commitment, passion and pride to achieve our corporate goals.
We aim to achieve a return of 13 per cent on our pub assets,
after taking account of the central cost of managing the portfolio.
This compares favourably to our current cost of capital.
In our beer and brands activities we endeavour to take a lead
position in the ale market in Scotland and Belhaven Best has
strengthened its position in the past year as Scotland’s most
popular draught ale in the on trade market. Apart from our
own brands, the beer products which underpin our portfolio,
Tennent’s Lager and Stella Artois, are sourced from InBev
with whom we have had a key strategic relationship for more
than twenty-five years.
One of the benefits of growing our pub estate is that Belhaven
strengthens its position as a route to market for beers, soft drinks,
wines and spirits and our drinks distribution business benefits as a
result of that in terms of both volume and purchasing clout. Our
drinks business has approximately 2,000 free trade customers in
Scotland which gives us an excellent insight into the market place
and this knowledge helps our pubs business identify potential 
acquisitions to add to our own estate. So, each division feeds
off the other.
REVIEW OF TRADING IN 2004/2005
Market conditions during the year have not been particularly
favourable, with weather conditions in the summer not matching
the heatwaves of 2003 and with Christmas falling on a Saturday
which disrupted weekend trading patterns. Consumer spending in
2005 has been unpredictable in the licensed trade, mirroring the
broader retail picture in Scotland.
Despite this, both Belhaven Pubs and Belhaven Drinks performed
excellently with sales and profits exceeding internal expectations
and comfortably ahead of previous year.
Tables 1 to 4 give a succinct overview of the key statistics for the
year to which I will now add some relevant comments about each
trading arm of the Group’s business. Please note that, for reporting
purposes, our pub retailing and tenanted estate activities are
aggregated to present the results of Belhaven Pubs and our beers
and brands and drinks distribution activities are aggregated to
present the results of Belhaven Drinks.
PUB RETAILING
Profits from retail increased by an admirable 30.3 per cent, driven
by the expansion of the pub estate and our ability to maintain
like-for-like turnover despite additional competition from new licences
and the aggressive pricing policies of some of our competitors.
Margins were also extremely well protected. Overall, our rate of
conversion of turnover:operating profit was 25.3 per cent, which
was a superb performance given the 16 per cent hike in the
minimum wage in the past two years, significantly higher energy
costs and rises in the cost of providing satellite television and in
music copyright and reproduction charges. Total labour costs only
edged ahead by 0.2 per cent of turnover, thanks to careful and
attentive management, and we maintained our gross margins on
food and bar sales. One of the benefits of the expansion of our
pub estate over the past few years is the achievement of enhanced
purchasing and marketing benefits from suppliers.
A new management development programme was created to
identify and cultivate potential retail managers as well as to 
Stuart Ross
Chief Executive CHIEF EXECUTIVE’S REVIEW
8 The Belhaven Group plc
provide continuing personal development for existing managers.
Scottish Vocational Qualification (SVQ) training has been increased
and Belhaven is now one of the largest operators of
such courses in Scotland.
One of the peculiarities of pub retailing is the relatively fast
turnover of part-time staff so we require to tailor our training,
coaching and induction programmes accordingly. Bonus incentive
schemes for pub management are designed to reward both
performance and loyalty.
TENANTED ESTATE
Our tenanted estate delivered a profit increase of 34.4 per cent
which was one of the principal drivers of our success last year.
We expanded the tenanted estate by 30 units during the course of
the year and we provided the bulk of the finance for the upgrading
of a further 23 houses. These are the key factors which
underpinned a sparkling set of figures. Like-for-like sales increased
by 1.4 per cent and like-for-like profits increased by 5.7 per cent.
We repeated the decision taken in 2003 to absorb part of the
inflationary list price increases on the draught lagers which we offer
to our tenants, and we will do so again in 2005. We are very aware
that our tenants need to compete against other on-premise
businesses and the take home trade where there is minimal year-
on-year uplift on the price of leading beer brands. This policy has
undoubtedly helped our tenants and has also helped us grow
overall beer volumes. Beer sales through the tenanted estate
increased by 27.9 per cent in total.
Recruitment of licensees with the talent and ambition to maximise
the potential of our pubs remains our top priority and last year we
increased our resources and our marketing and search activities to
achieve this objective. We will be further investing into the
recruitment function in the current financial year.
PUB ACQUISITION PROGRAMME
Planning and licensing authorities are giving greater consideration
to over-provision and neighbourhood issues. As a result, it is
becoming increasingly difficult to identify unlicensed sites for
which conversion consent will be granted.
We see more opportunity to expand the tenanted estate than
the managed estate in 2005/2006, thus continuing the pattern
set last year.
From an operational point of view, it makes sense to switch some
of our smaller managed houses into the tenanted estate during the
course of this year, which will enable us to focus management time
and energy to maximum effect.
BEERS AND BRANDS
At our Dunbar brewery it was definitely a tale of two halves with
record levels of throughput in all our activities, brewing, bottling
and kegging in the first six months. However, due to a sharp
downturn in contract bottling volumes in the second six months,
overall activity was much reduced and profit was adversely
affected. We are in the process of negotiating a new three year
contract to package certain products for InBev which will have a
significant effect in redressing this decline.
Belhaven Best’s popularity continues to go from strength to
strength, with an increase in volume of 8.6 per cent last year. It is
now one of Scotland’s top ten alcoholic drinks in the pub trade and
it remains Scotland’s most popular draught ale in the on trade,
TABLE 1 53 weeks 52 weeks
Profit Summary to 3.4.05 to 28.3.04 Increase
£m £m %
Operating Profit - Belhaven Pubs 15.10 11.81 27.9
- Belhaven Drinks 8.58 7.94 8.1
Administration costs (3.22) (3.15)
Operating Profit 20.46 16.60 23.2
Interest (3.03) (2.37)
Profit before Tax 17.43 14.23 22.5
TABLE 2 Managed Tenanted Total
The Pub Estate Houses Estate Pubs
Numbers of Pubs
At beginning of April 2004 89 137 226
Additions in the year 17 30 47
Disposals in the year – (3) (3)
Transfers (5) 5 –
At end of March 2005 101 169 270
Value of Estate
As at March 2005 £78.63m £62.74m £141.37m
Value per pub
as at March 2005 £779k £371k £524k
“Both Belhaven Pubs and Belhaven Drinks 
performed admirably with sales and
profits comfortably ahead of previous years.”
Belhaven Report FRONT  1/6/05  9:27 AM  Page 8 having widened the gap with its nearest competitor. In November
2004 we reached the sales landmark of 100 million pints of Best
since the beer pioneered the UK nitrokeg sector in the early 90s.
Volumes have grown each year since then and we continue to
support our key brand with advertising, promotions and trade
marketing activity which highlight the quality and popularity
of the product.
Our brand strategy includes the use of local sponsorships which
add value and distribution to Best. We have recently renewed our
sponsorship deal with the Scottish Golf Union for a further five
years and we are committed to various activities at the Edinburgh
Festival Fringe this summer.
Belhaven Best also performed exceptionally well for us in the take
home trade with sales volumes up by 20.5 per cent, albeit from a
much smaller base than draught Best. Our overall take home
contribution was satisfactory, given the congestion of brands in this
sector and the difficulties which all small suppliers face in
improving margins on sales to national grocers whose dominance
of the market increases each year. Our range of Classic Choice
speciality beers has added welcome volume and attractive pricing.
Export sales held up very well in Europe but we suffered a small
decline in the States which was not unexpected given the strength
of the pound against the dollar.
DRINKS DISTRIBUTION
Trade was impressive throughout the year and total volumes
increased by 10.5 per cent in a market which declined by about
3 per cent.
The lifeblood of our drinks distribution division is new business and
we again comfortably exceeded the internal targets which were set.
Equally pleasing was the 7.1 per cent growth in net profit achieved
on sales to free trade customers, helped by close control of operating
costs at all our distribution centres.
We work hard to build close and durable business relationships with
our trade customers. We have a well spread business, supplying
over 2,000 customers and, aside from our own pub estate, the largest
volume with any one customer represents only 3.4 per cent of our
total volumes. We have a valuable beer supply connection with the
expanding Maclay Group and we continue to evolve our relationship
with the high profile Montpelier Group with whom we have
recently concluded a joint venture agreement to develop a hotel
with bar, restaurant and club facilities in Edinburgh’s George Street.
Our distribution resources have been significantly improved
through the provision of a new warehouse at Dumyat Business Park
near Stirling at a cost of £1.27 million. This is a freehold unit which
is exceptionally well located and it will serve us extremely well in
the future, as will our other distribution centres in Dunbar,
Aberdeen and Dumfries. Scotland’s road network is becoming
increasingly congested and we endeavour to organise our
distribution routes in such a way as to drive against the flow of
traffic wherever possible.
COST PRESSURES
We currently face unwelcome cost pressures, most of which are
not of our own making. At the brewery, energy, effluent treatment
and water costs have risen sharply. In drinks distribution, the cost of
fuel continues to escalate and we have incurred higher overhead
depreciation and finance charges as a result of expanding our
warehouse facilities in Stirling. The upward trend in the minimum
wage remains the principal driver of cost in our pubs which are not
immune to the issues affecting the other divisions.
CHIEF EXECUTIVE’S REVIEW
Annual Report and Accounts 2005 9
TABLE 3 53 weeks 52 weeks
Belhaven Pubs Results to 3.4.05 to 28.3.04 Increase
£m £m %
Turnover - Managed 44.19 33.51
- Tenanted 14.49 10.77
Total 58.68 44.28 32.5
Profit Contribution - Managed 11.19 8.59
- Tenanted 7.69 5.72
Total 18.88 14.31 31.9
Pub central costs (3.78) (2.50)
Operating Profit - Belhaven Pubs 15.10 11.81 27.9
TABLE 4 53 weeks 52 weeks
Belhaven Drinks Results to 3.4.05 to 28.3.04 Increase
£m £m %
Turnover including internal sales 80.33 69.24 16.0
Gross Profit 34.18 29.60 15.5
Selling costs (8.66) (7.88) 9.9
Discounts on internal sales (8.53) (6.18) 38.0
Overheads (8.41) (7.60) 10.7
Operating Profit - Belhaven Drinks 8.58 7.94 8.1 “Belhaven Best’s popularity continues
to grow with an increase in volume
of 8.6%.” PEOPLE
I am pleased to say that Belhaven was re-accredited (for the
third time) as an Investor in People in June 2004 and we continue
to use performance management techniques to catalyse training
programmes in all departments of the Company.
The Chairman has already thanked employees at all levels of the
Group and I would warmly endorse his remarks. I would particularly
like to thank my four direct reports David Morrison, Ian Herok,
Jeff Myers and Bill Hughes for their pivotal contributions over the
past year. The executive management team very much appreciates
the valuable advice and counsel proffered by our non-executive
Directors Angus Meldrum, Alistair Arkley and Graeme Bissett and
we are indebted to them for their thorough approach to the
obligation imposed upon Belhaven to comply with new corporate
governance regulations.
I look forward very much to working with our new Group Finance
Director Ron Robson who has recently taken over from David
Morrison with whom I forged a close business relationship for the
best part of thirty years. Best wishes, David, and thanks.
Finally, I would like to express our appreciation to all those who
support us – our shareholders, our trade customers and consumers,
our tenants, our suppliers, our professional advisors and our bankers.
Belhaven is indeed fortunate in the outstanding loyalty and
consistent backing which we have received from a wide variety of
important stakeholders in the business over many years now.
RECENT TRADING AND OUTLOOK
Levels of trading and profitability in the first two months of the
new financial year have been in line with internal expectation.
Consumer spending patterns remain inconsistent and market
conditions are as challenging as they were last year. Belhaven has a
resilient business model which has stood the test of time and my
colleagues and I are confident that we will achieve our immediate
aim of delivering a sixteenth year of uninterrupted growth.
The outlook beyond March 2006 is less certain. It is not possible
to predict the impact on the turnover of pubs as a result of the
proposed ban on smoking in licensed premises and Belhaven does
not expect to be immune from the general effect. The smoking
ban represents a major cultural change for Scottish people and
presents both opportunities and threats for the pub industry.
Our management team will be highly focused on mitigating
the threats and maximising the opportunities.
Stuart Ross
Chief Executive
6 June 2005 
CHIEF EXECUTIVE’S REVIEW
Annual Report and Accounts 2005 11 Regulatory issues facing the industry. Annual Report and Accounts 2005 13
In his Chairman’s Statement,Angus Meldrum
referred to the pace of regulatory change.
In this section of the Annual Report we
discuss the issues in more detail with our
senior executive management team. Jeff
Myers, MD Pubs; Bill Hughes, MD Drinks
Distribution and Ian Herok, MD Beers
answer questions which many shareholders,
employees and other stakeholders in
Belhaven will currently be asking.
How do you plan to minimise the threats
and maximise the opportunities posed by
the planned ban on smoking in all licensed
premises in Scotland, which is expected to
take effect from March 2006?
Jeff
There is no question that the new legislation
will bring a period of uncertainty to the
Scottish licensed trade and to the sector
generally but we are taking very active steps
to be ready for the curb on smoking.We have
already conducted a full survey of each of
our managed and tenanted houses to identify
how we can best provide comfort and
shelter in external areas for our customers
who wish to enjoy a cigarette. The scale of
external opportunity will vary from pub to
pub, depending on the availability of space
and immediate neighbourhood and noise
issues, but most of our sites offer some
open air provision for our customers.
Lessons have been learned from Ireland
where a smoking ban has been in place
since March 2004 and where the provision
of decent facilities for smokers has given
some licensees a competitive edge. Pub food
sales should benefit from a smoke-free
environment, especially those with children’s
certificates. This is a marketing opportunity
for many of our houses.
A
Q
Bill
We have long tried to position our free trade
drinks business as the “champion of the
independent”. This is an ideal opportunity
for us to underline our commitment to our
independent licensees, not only by sharing
our knowledge with them but also by
providing practical advice and guidance
and, in some cases, funding support.
Ian
New, improved external areas will provide
novel branding opportunities for Belhaven
Best and we aim to be in a position to take
advantage of that, whilst simultaneously
providing useful and pragmatic materials
for our own pubs and for free trade
customers.
How will you cope with enforcement of the
law if pub customers transgress the new
smoking rules?
Jeff
We will be providing very clear, well
positioned signage in every pub and we will
not offer ashtrays or any other utensils
which would encourage smokers. All our
staff will be trained to politely request
smokers to leave the premises and smoke
in the areas provided externally. We
understand from Scottish Health Minister
Andy Kerr that we will have fulfilled our
obligations under the legislation if we take
these measures but confirmation is awaited
during the Second Stage debate in the
Holyrood parliament.
A
Q
A
A
Will there be a profit hit due to the reduced
sales of tobacco in pubs?
Jeff
We don’t see this as a particularly
significant issue; neither our own pubs nor
our free trade customers make meaningful
profits from cigarette sales. Most pubs do
not sell cigarettes but simply rent space to
cigarette machine vendors who contribute
a modest commission.
The extension of the Working Time Directive
has restricted the hours which transport staff
can work. Is this a problem for Belhaven?
Bill
No, although it has necessitated our
reviewing our distribution arrangements.
We have been able to move some of our
longer range delivery routes from Dunbar to
our new premises at Stirling which will help
us comply with the new regulations which
are more restrictive than the requirements
under the Road Traffic Acts.
What are the advantages to Belhaven from
the new licensing proposals contained in
the recently-issued Licensing (Scotland) Bill?
Jeff
We welcome the concept of the new
premises licence under the terms of which
we will have trading hours set for a ten year
period.This enables us to plan our businesses
better and obviates the requirement to
apply for annual extension licences. We
fully support the provisions for mandatory
training of staff which we believe will
improve the standards in Scotland’s
hospitality industry. We are pleased that
A
Q
A
Q
A
Q
QUESTIONS AND ANSWERS
Jeff Myers Bill Hughes Ian Herok “The principal changes we face
are licensing law reform and the
smoking ban.” Annual Report and Accounts 2005 15
QUESTIONS AND ANSWERS
registered clubs are to be brought within
the licensing framework, as this
undoubtedly creates a more level playing
field from the competitive point of view.
Bill
Belhaven supports free trade customers
with finance to assist the purchase and
development of their businesses and the
concept of the premises licence will add
value to the securities which we hold over
licensed properties. The separation of the
premises from the personal licence
undoubtedly gives us additional comfort
in this important part of our drinks
business activities.
What regulatory measures are being taken
in Scotland to inhibit binge drinkers?
Jeff
For the past few years many of Scotland’s
thirty-two licensing boards have been
introducing different types of restriction, some
of them based on minimum pricing. We
welcome the fact that the new Licensing
Bill will introduce measures which will be
consistently applied throughout Scotland.
The Bill incorporates proposals which outlaw
happy hours and promotional activity which
rewards consumers for drinking alcohol
quickly or excessively. We support these
changes which will help eliminate irresponsible
licensees from the Scottish trade.
Bill
The Licensing Bill also prohibits alcoholic
drinks promotions which are specifically
targeted at younger people. We endorse
this policy and we will continue to
shape our brand promotional activity
to underline quality and encourage
sensible drinking patterns.
A
A
Q
A
Have the recently-introduced provisions of
the Disability Discrimination Act posed any
difficulties for Belhaven?
Jeff
We see the provision of facilities for
disabled people, whether wheelchair-bound
or otherwise, as an acceptable obligation
and indeed in some ways as a business
opportunity. We train our staff to
understand their needs and to do whatever
is pragmatically possible to encourage
disabled persons to visit our pubs where I
hope they will find a warm welcome.
Scottish and Newcastle recently cited high
overhead costs as a reason for their closure
of their Edinburgh brewery. Are you worried
that Belhaven will become uncompetitive
in terms of unit costs, as more and more
UK beer production is moved south of the
border where there is a more advantageous
cost base?
Ian
Belhaven is fortunate in that our brewery
is located in a rural environment with
relatively low overheads. We own all our
land and buildings and almost all our plant.
A
Q
A
Q
We do face a cost challenge next year when
European waste water regulations will dictate
a substantial hike in the cost of effluent
treatment. Our focus will be on reducing
the volume of effluent which is put to drain
and we will be endeavouring to tighten our
costs elsewhere, to compensate for this
unwanted additional burden.
How is the quinquennial review of pub
rateable values in April 2005 likely to
affect costs?
Jeff
Many of the new rateable values represent
a significant increase and are not, in our
view, justifiable. Scottish pubs are unfairly
rated in comparison to their English
counterparts and we pay a higher uniform
business rate in Scotland. We will be
working with our independent agent to
have as many assessments as possible
successfully appealed before the transitional
relief provisions expire in March 2008. The
outturn of the appeal processes will dictate
the final impact on costs.
A
Q FINANCIAL REVIEW
16 The Belhaven Group plc
TRADING PERIOD
The Group’s 2005 results cover a 53 week trading period, whereas
those for 2004 cover a 52 week trading period. To aid comparability
with last year, the table below summarises the actual and pro-rata
results, and compares these to the 2004 actual results. Elsewhere
in this report, the results stated are for the 53 week period unless
otherwise explained.
2005 2005 2004
Actual Pro-rata Actual Uplift
53 weeks 52 weeks 52 weeks 52 weeks
£’000 £’000 £’000 %
Turnover 114,438 112,279 94,957 18.2%
Operating profit 20,459 20,073 16,604 20.9%
Net interest payable (3,031) (2,974) (2,373)
Profit before tax 17,428 17,099 14,231 20.1%
Tax (4,453) (4,369) (4,127)
Profit after tax 12,975 12,730 10,104 26.0%
Earnings per share 43.7p 42.9p 37.2p 15.3%
OPERATING PROFIT
Operating profit for the 53 weeks rose by 23.2% from £16.60 million
to £20.46 million. This was equivalent to an increase of 20.9%, or
£3.47 million, for the 52 week equivalent period.
INTEREST PAYABLE
Interest payable increased by £1.02 million from £2.67 million to
£3.69 million and interest receivable from trade loans increased by
£0.36 million from £0.30 million to £0.66 million.
Interest payable was impacted by an increase in average underlying
bank base rates from 3.7% during 2004 to 4.6% during 2005. The
mainreason for the increased charge however was the higher average
level of debt during the year required to fund the accelerated pub
acquisition programme.
Interest receivable is earned on advances to customers and trade
loans, which are an important factor in the success of our drinks
business. Our investment in these increased by £2.46 million during
2005 from £21.64 million to £24.10 million.
TAXATION
The charge for tax, including deferred tax, for the year was
£4.45 million compared to £4.13 million for the prior year, with an
effective rate of tax of 25.6% compared to 29.0% in 2004. During
the year we finalised the capital allowance calculations for a
number of prior years, which resulted in the release of deferred
tax estimates and accounts for the bulk of the reduction in the
effective tax rate for the year. It is unlikely there will be a similar
reduction in the effective rate for 2006.
EARNINGS PER SHARE
Earnings per share rose by 17.5% to 43.7p from 37.2p in 2004.
The average number of shares in issue during the year was 29.71
million compared to 27.17 million during 2004, the current year
showing the full effect of the share placing and open offer
completed in July 2003.
DIVIDENDS
The proposed final dividend of 8.00 pence per share, together with
the interim dividend of 4.35 pence per share, represents an increase
of 10.3% on the previous year. If approved by shareholders, this will
be the eighth consecutive year that the increase in the annual rate
of dividend has been in excess of 10%. The dividend is covered 3.5
times by profits after tax.
CASH FLOW
One of the Group’s strengths is strong operational cash flow, which
makes a significant contribution to funding our capital expenditure.
In 2005 cash flow from operations increased by 21.5% from
£20.82 million to £25.29 million.
Net interest payments during the year were £3.03 million, tax paid
was £4.12 million and dividends paid accounted for £3.45 million.
After these cash outflows totalling £10.60 million we had available
£14.69 million of cash and this, together with a net increase in
borrowings of £16.60 million and £0.67 million from the issue
of new shares, funded net capital investment including additional
trade loans, of £31.96 million. This investment included the
acquisition of an additional 44 public houses and refurbishment of
a significant number of our existing properties.
NET ASSETS AND FUNDING
Net assets during the year increased by £14.47 million, including
£4.43 million of unrealised gain on revaluation of the pub estate, to
£94.88 million. Net debt at the end of the year stood at £67.10
million, an increase of £16.60 million from £50.50 million at the
end of 2004. This included £15.03 million (2004: £13.48 million) of
trade loans sold on to the Bank of Scotland.
Ron Robson 
Finance Director Excluding these trade loans sold on, overall gearing stood at 54.9%
compared to 46.0% at the end of 2004.
To protect the Group from upward movements in interest rates, we
have in place two swaps of £10.0 million each at 4.48% and 4.60%
respectively, one expiring in December 2005 and the other in
December 2006.
Subsequent to the year end we have agreed an increase in the
bank facilities available to the Group of £11 million, which along
with cash generated by our trading activities will fund anticipated
capital investment over the coming year.
INTERNATIONAL FINANCIAL REPORTING STANDARDS
The Group accounts are currently prepared using United Kingdom
Generally Accepted Accounting Principles (UK GAAP). From 2005,
EU legislation requires us to adopt International Financial Reporting
Standards (IFRS) when preparing our accounts.
The Group is preparing for the transition to IFRS and the accounts
for the year to 2 April 2006 will be the first full year to be
presented under these new standards. The results for the period to
3 April 2005 will be converted to IFRS and presented as
comparative figures with the 2006 results. The balance sheet as at
28 March 2004 will therefore become the starting point for the
Group’s reporting under IFRS. A full reconciliation between the UK
GAAP accounts for 2005, including the 28 March 2004 balance
sheet, and their restatement using IFRS will be included with the
2006 Annual Report to provide a complete picture of the effect of
adoption of these new accounting standards.
Our interim report to 2 October 2005 will also be prepared using
IFRS and will include comparative figures for the first half of the
year to 3 April 2005 on the same basis.
The main areas of difference between UK GAAP and IFRS identified
so far and which will impact on the Group accounts are set out
below. In addition to these, the format and presentation of the
accounts and supporting notes will change to comply with IFRS.
• Revaluation of fixed assets
Under UK GAAP we have elected that the balance sheet carrying
value of our pubs is subject to periodic revaluation under the 
provisions of FRS 15.
Under IFRS we have the choice whether to perform periodic 
revaluations or to apply the cost approach, using the book 
value at 28 March 2004 as “deemed cost”.
•
Loans to customers and trade investments
Under IFRS loans and trade investments have to be shown as if 
they carried a full market rate of interest, even where this is 
different from the underlying contractual terms. This will 
increase interest income shown in the profit and loss account,
with an offsetting increase in discounts granted, but profit 
before tax will be unchanged.
•
Goodwill amortisation
IFRS do not permit goodwill to be amortised through the profit 
and loss account. Instead, it is carried at cost and is subject to 
an annual impairment review.
•
Defined benefit pension scheme
The Group currently provides disclosures under the transitional 
arrangements set out in FRS 17. Under IFRS the accounting 
treatment will not be materially different to that required from 
full adoption of FRS 17 as shown on pages 55 to 57.
•
Interest rate swaps
The swaps currently entered into by the Group will require 
to be included in the balance sheet at their fair value (as set
out in note 16 to the accounts on pages 49 and 50) and
future changes to this will then flow through the profit
and loss account.
•
Deferred tax
Under UK GAAP deferred tax is based on the differences between
the profits as shown in the accounts and those calculated for 
tax purposes. Under IFRS the calculation takes into account 
differences between the balance sheet values of assets and
liabilities and their value for tax purposes. The main effect of
this will be a requirement to include in the accounts deferred 
tax on the surplus of revalued assets over their original cost.
•
Excise duty
Excise duty is payable to the Government when products leave 
either the brewery or one of our duty suspended warehouses.
Under IFRS this is treated in the same way as VAT and will be 
excluded from both sales and cost of sales, but with no impact 
on profits.
Ron Robson
Finance Director
6th June 2005
FINANCIAL REVIEW
Annual Report and Accounts 2005 17 BOARD OF DIRECTORS
18 The Belhaven Group plc
Stuart Ross (56) 
Chief Executive 
The holder of a law degree and a member of
ICAS, Stuart took up his current position in 1989
and subsequently led the MBO in 1993 and the
flotation of Belhaven in 1996. He has spent
almost his entire working life in the leisure sector
and has held a variety of senior positions in the
brewing industry and licensed trade in Scotland.
Ron Robson (42) 
Finance Director
After a few years in the merchant navy, Ron
gained his degree at Aberdeen University and
worked in the accounting profession for nine years
with Arther Andersen and Johnston Carmichael. A
member of ICAS, he has since 1996 gained
experience of senior finance roles in both private
and public companies and prior to joining Belhaven
also held a non-executive directorship at Aberdeen
Harbour Board.
Alistair Arkley (58) 
Non-Executive Director 
An experienced and well known industry figure
and businessman in the North East of England.
He is currently founder and major shareholder of
a number of companies, including New Century
Inns which operates tenancies in England. Alistair
was formerly founder and chief executive of
Century Inns plc and prior to that at Brent Walker
Breweries, Scottish Brewers and Procter & Gamble.
He was educated at Aberdeen University and
joined the Board in September 1999.
Angus Meldrum (59) 
Non-Executive Chairman
Angus joined the board in January 2002. Born on
the Isle of Lewis and educated at Edinburgh and
Bath Universities, he enjoyed a long career with
Bass rising to UK Brands Marketing Director of
Bass Brewers and in his last 10 years M.D. of
Tennent Caledonian Breweries. Angus has held
high-level positions within the drinks industry in
Scotland and he is a non-executive director in the
hotel industry.
Graeme Bissett (47)
Non-Executive Director
Graeme, an accountant and corporate financier,
was a partner in Arthur Andersen with responsibility
for its corporate finance and audit practices in
Scotland from 1990 until 1998. Between then and
2003 he held senior executive positions with
Kwik-Fit Holdings plc and Damovo Group SA. He
chaired technical committees of ICAS between
1993 and 2002 and is currently Chairman of
Heriot Watt University's Finance Committee. He
holds a number of other non-executive positions. SENIOR EXECUTIVE TEAM
Annual Report and Accounts 2005 19
Ian Herok (56) 
MD Beers Division 
Ian joined Belhaven in 1991, having previously
gained wide experience in the Scottish brewing
industry since 1974, during which time he also
travelled internationally undertaking various
production and commercial roles, particularly in
the US and the Far East. His career with Belhaven
has progressed from his initial appointment as
Operations Director to that of MD of the Beers
Division. Ian is a qualified master brewer and was
a key member of the MBO and flotation teams.
Jeff Myers (42) 
MD Pubs Division 
An Honours graduate of London University, Jeff
spent 5 years with Allied Domecq and 4 years
with Scottish and Newcastle. He has driven the
expansion of Belhaven’s pub estate since joining
Belhaven in 1995.
Bill Hughes (50) 
MD Drinks Distribution Division
Bill joined Belhaven in November 2000 and was
appointed to the Board on 1 January 2001. He has
extensive trade experience, both in retail and in
drinks distribution, having progressed his career
through various senior sales positions in Scottish
Courage for whom he worked for 13 years.
1
2
3
4
5
The Senior Executive team: 1. Ian Herok.
2. Ron Robson. 3. Stuart Ross. 4. Jeff Myers.
5. Bill Hughes. DIRECTORS’ REPORT
20 The Belhaven Group plc
The directors present their annual report and the audited financial statements for the 53 weeks ended 3 April 2005.
PRINCIPAL ACTIVITIES AND BUSINESS REVIEW
The principal activities of the Group are retail management and leasing of public houses and the sale and distribution of beer and other drinks,
including those brewed and packaged at our Dunbar base. The results of the Group are described in the financial highlights and the reviews on the
preceding pages.
RESULTS AND DIVIDENDS
£’000
Group results and dividends (paid and proposed) are as follows:
Profit on ordinary activities before taxation 17,428
Tax on profit on ordinary activities (4,453)
Profit for the financial year 12,975
Dividends (3,697)
Retained profit for the financial year 9,278
Dividends comprise:
– interim – 4.35p per share, paid on 21 January 2005 1,309
– final – proposed 8.00p per share, to be paid on 1 August 2005 2,388
3,697
DIRECTORS AND THEIR INTERESTS
The directors who served during the year and their interests in the ordinary shares of the Company were:
3 April and 6 June 28 March
2005 2004
Number Number
Stuart Ross 266,670 287,374
David Morrison (resigned 31 March 2005) 108,594 116,594
Chris Greig (resigned 16 July 2004) 20,971 20,971
Alistair Arkley 9,082 9,082
Graeme Bissett (appointed 29 March 2004) 3,336 3,336
Angus Meldrum 1,250 1,250
Graeme Bissett retires by rotation at the next Annual General Meeting and, being eligible, offers himself for re-election. Ron Robson was appointed
on 4 April 2005, subsequent to the year end. He retires at the next Annual General Meeting and, being eligible, offers himself for election. As at 
6 June 2005 he has no beneficial interest in the ordinary shares of the Company.
Of Stuart Ross’ holding, 125,900 ordinary shares are held by Linden Ross, his estranged wife from whom he has been de facto separated since 
October 1999.
SUBSTANTIAL SHAREHOLDINGS
On 20 May 2005 the Company had been notified, in accordance with Sections 198 to 208 of the Companies Act 1985, of the following substantial
shareholdings:
Number of
ordinary shares
Percentage ’000s
Hermes Pensions Management 5.93 1,770
Morley Fund Management 5.77 1,722
UBS Global Asset Management 5.70 1,701
Fidelity 5.28 1,575
Standard Life Investment Management 4.34 1,295
Speirs & Jeffrey 4.02 1,199
Merrill Lynch Investment Managers 3.84 1,146
Legal & General Investment Management 3.72 1,111
Framlington Investment Management 3.11 927
Artemis Investment Management 3.10 924
M & G Investment Management 3.03 903 Annual Report and Accounts 2005 21
DIRECTORS’ REPORT
CLOSE COMPANY STATUS
The Company is not a Close Company within the provisions of the Income and Corporation Taxes Act 1988.
CHARITABLE AND POLITICAL DONATIONS
No political donations were made during the year (2004: £nil). Charitable donations of £22,000 (2004: £19,000) were made during the year.
CREDITORS PAYMENT PRACTICE 
Credit terms with the majority of suppliers are such that payment is made by the Group at the end of the month following the month of receipt 
of goods and services. The remaining suppliers are paid on the basis of pre-agreed terms on a supplier by supplier basis. To take advantage of
favourable early settlement discount terms the Group’s main supplier is paid weekly in advance. Trade creditors of the Group at 3 April 2005 were
equivalent to 23 days (2004: 22 days) purchases, based on the average daily amount invoiced by suppliers during the year. The Company has no
trade creditors.
DISABLED EMPLOYEES
Applications for employment by disabled persons are always fully considered, bearing in mind the skills and aptitudes of the applicant concerned.
In the event of members of staff becoming disabled, every effort is made to ensure that their employment with the Group continues and that
appropriate training is arranged. It is the policy of the Group that the training, career development and promotion of disabled persons should,
as far as possible, be identical to that of other employees.
EMPLOYEE CONSULTATION
The Group places considerable value on the involvement of its employees and keeps them informed on matters affecting them as employees and
on the various factors affecting the performance of the Group. This is achieved through formal and informal meetings with employee groups at
regular intervals. The Group also communicates with district trade union officials and employee representatives who are consulted on matters
affecting current and future interests. The Group was awarded Investors in People accreditation in July 1999 and re-accreditation in March 2002 
and June 2005.
AUDITORS
A resolution to re-appoint Deloitte & Touche LLP as the Company’s auditors will be proposed at the forthcoming Annual General Meeting.
ANNUAL GENERAL MEETING
Notice of the 2005 Annual General Meeting is set out on page 58 of this document. At the meeting shareholders will be asked to consider a special
resolution which will be proposed in order to disapply the statutory pre-emption rights of section 89(1) of the Companies Act 1985.The disapplication
of statutory pre-emption rights will enable the directors at any time until 14 October 2006 to allot equity securities for cash up to an aggregate
amount of £149,250 or otherwise in connection with a pro rata issue of shares to shareholders. This limited disapplication will allow the directors
to allot up to1,492,505 ordinary shares for cash, representing approximately 5.0% of the total issued ordinary share capital of the Company as at
the date of this document.
By order of the Board
Ron Robson
Secretary
6 June 2005
Dunbar
East Lothian
EH42 1PE 22 The Belhaven Group plc
The Group is committed to the principles of corporate governance contained in the Combined Code, which is appended to the Listing Rules of the
Financial Services Authority and for which the Board is accountable to shareholders. Following the findings of the Higgs Committee on the role and
effectiveness of non-executive directors and the Smith Committee on audit committees, the Financial Reporting Council issued a revised Combined
Code in July 2003 (the Combined Code). The Board has reviewed its Corporate Governance policies and practices and has assessed its compliance
against the Combined Code.
STATEMENT OF COMPLIANCE WITH THE CODE OF BEST PRACTICE 
The Group has complied throughout the year with the provisions of the Code of Best Practice set out in Section 1 of the Combined Code except for
the following matters: Code provision B.1.6 requires the Board to have an objective of setting periods of notice at one year or less. Stuart Ross’
contract of employment carries a period of notice of two years. The Board believes that it is desirable to maintain this long-standing period of
notice and does not consider the benefit of reducing this to one year justifies the cost to shareholders of achieving it. The Chairman has contacted
a cross-section of shareholders and they have agreed with our explanation. A future Chief Executive will have a one year contract.
THE BOARD 
The Board comprises of the Chairman, two independent non-executive directors and two executive directors. The Board is headed by Angus
Meldrum who was appointed Chairman on 16 July 2004, following the resignation of Chris Greig on the same day. Angus Meldrum has no other
significant commitments that would impact upon his role. The two non-executive directors are Alistair Arkley, the senior independent director, and
Graeme Bissett. The two executive directors are Stuart Ross the Chief Executive and Ron Robson the Finance Director, who was appointed on 4 April
2005 to replace David Morrison who retired on 31 March 2005.
The terms and conditions of each non-executive director’s appointment are contained in individual letters of appointment. Each has a contract
which is subject to a rolling period of three months’ notice. These terms and conditions are available for inspection at the Company’s registered
office during normal business hours and at the Annual General Meeting.
Board balance
The division of roles of Chairman and Chief Executive and the balanced composition of the Board create an effective forum that provides leadership
and strategic direction to the Group, as well as the expertise to evaluate its overall performance.
The Board operates as a team with the non-executive directors bringing a wide range of experience obtained at a senior level. Alistair Arkley and
Graeme Bissett are independent of the management of Belhaven, and are free from any business or other relationships which would materially
interfere with the exercise of their judgement. The Chairman is similarly free of such relationships but the provisions of the Combined Code do not
allow the role of a Chairman to be considered as independent in this way. The non-executive directors have a particular responsibility to ensure that
the strategies proposed by the Chief Executive are carefully examined and to scrutinise and challenge performance.
Board responsibilities
The Board is responsible for overall leadership of the Group, setting its strategic objectives, satisfying itself as to the trading performance of the
business, the integrity of financial information, the effectiveness of the internal control and risk management processes, as well as ensuring that the
obligations to shareholders are met.
The Board has delegated the normal operational management of the Group to the senior executives responsible for our principal operating
divisions, who have clearly defined guidelines and delegated authority rules which govern the specific matters subject to Board approval.
Board meeting agenda
There is a formal schedule of matters reserved to the Board for its decisions. These matters include strategy, corporate risk assessment, health and
safety, corporate governance, review of operating activities, financial status and capital expenditure approval. The Board papers include the Chief
Executive’s report, the Finance Director’s report, a summary of capital expenditure for approval and summary of internal audits carried out. The
Board papers are circulated to the directors a week in advance of any Board meeting to allow each director to consider in full the performance of
the Group and any specific matters under discussion. Where a new major risk is identified additional discussions take place.
All directors have access to the advice and services of the Company Secretary (who is also the Finance Director), the removal of whom would be a
matter for the whole Board. The directors may, at the Group’s expense, take independent professional advice should this be necessary in furtherance
of their duties. The Company Secretary is responsible for ensuring that Board procedures are followed, that applicable rules and regulations are
complied with and acts as secretary to the Board. The Company Secretary is also responsible for ensuring that directors have access to appropriate
external training if required, as well as a full tailored induction programme on initial appointment.
CORPORATE GOVERNANCE STATEMENTS Board attendance
The Board meets regularly at least five times each year, with additional meetings held if required. Attendance at Board and Board Committee
Meetings was as follows:
PLC Remuneration Audit Nominations
Number of members 5224
Number of meetings 5222
Attendance
Stuart Ross 5 2
David Morrison 4
Angus Meldrum 5 2
Alistair Arkley 5222
Graeme Bissett 4222
The formal Board meetings are supplemented by periodic conference calls. These calls are not formal meetings.
Responsibility of Chairman and Chief Executive
The division of responsibilities between the Chairman and the Chief Executive has been clearly established, set out in writing and agreed by the Board.
The Chairman is responsible for leadership of the board which includes overseeing board structure, appointment of the Chief Executive, overseeing
Board communication with shareholders, the setting of strategy and promoting the Group’s interests with third parties.
The Chief Executive is responsible for developing the strategic direction of the Group by preparing and evaluating strategic options for
recommendation to the Board. The Chief Executive is also responsible for implementing and evaluating annual budgets, achieving financial and
operational objectives, overseeing the day to day management of the Group as well as ensuring effective communication with employees,
shareholders, potential shareholders, analysts, the press and other appropriate third parties.
PERFORMANCE EVALUATION OF THE BOARD
During the last year, the Board has conducted a rigorous evaluation of its own performance. This involved the completion of an assessment
questionnaire by all directors covering the performance of the Board, individual directors and Board Committees. Other topics included meetings,
the provision of information, training and the overall effectiveness of the Board. The questionnaires were submitted to the Chairman, who prepared
a summary of the conclusions, which were discussed at the Board meeting in February 2005. This was followed up by meetings as appropriate with
individual directors.
REGULAR RE-ELECTION OF DIRECTORS 
The Articles of Association require directors to retire and offer themselves for election at the first Annual General Meeting following their
appointment. In addition, the Articles of Association require that each year one-third of the remaining directors are subject to retirement by
rotation. The directors to retire this year are set out in the Directors’ Report. The Nominations Committee leads the process for Board appointments
and makes recommendations to the Board.
During the year one non-executive director, Graeme Bissett, and since the year end one executive director, Ron Robson, have been appointed.
The appointments, including Graeme Bissett’s Chairmanship of the Audit Committee, were made on merit and against objective criteria and are
considered by the Board to have met all the criteria set out in the Combined Code.
The Board confirms that it is satisfied that Graeme Bissett, who is proposed for re-election following his retiral by rotation, continues to demonstrate
the necessary skill and commitment and is an effective member of the Board.
COMMUNICATIONS AND RELATIONS WITH SHAREHOLDERS
Communications with shareholders are actively encouraged and given a high priority. The Chief Executive and the Finance Director, at times
supported by the Chairman or senior independent director, have meetings with representatives of existing and potential institutional shareholders
throughout the year.
A full annual report and, at the half year, an interim report are sent out to all shareholders. These communications also include the preliminary
announcement, which is issued on the same day that the Group’s full year results are released.
Presentations on the Group’s results, strategy and outlook for the future are given to fund managers and city analysts after these results. There is
also an opportunity for individual shareholders to question the Board at the Annual General Meeting. All of the directors are pleased to meet
informally with shareholders after the meeting.
In the year under review the Chairman has contacted some of the leading shareholders in the Company to address any concerns and discuss any
issues.
CORPORATE GOVERNANCE STATEMENTS
Annual Report and Accounts 2005 23 CORPORATE GOVERNANCE STATEMENTS
24 The Belhaven Group plc
MAINTENANCE OF A SOUND SYSTEM OF INTERNAL CONTROL 
The Board is responsible for the Group’s system of internal control and for reviewing its effectiveness. Such a system of internal control is designed
to manage rather than eliminate the risk of failure to achieve business objectives, and can only provide reasonable and not absolute assurance
against material misstatement or loss. The Board has established a continuous process for identifying, evaluating and managing the significant risks
the Group faces. The Board regularly reviews the process, which has been in place from the start of the year to the date of approval of this report.
The Board devoted a significant degree of attention to internal control during the year including a review of the Group’s risk management
procedures. At Board level, the directors review the principal strategic, operational and financial risks facing the business and confirm their
satisfaction with the adequacy of controls in place to manage these risks. Management of each of the operating divisions and the central services
division review risk as part of periodic management board agendae to reaffirm their understanding of the principal operational risks facing the
business and categorise the risks identified for priority assessment. These are documented in Risk Registers for each division. The executive directors
attend these divisional management meetings and raise relevant risk issues with the Board on a regular basis. Management then confirms that
adequate controls are in place and that these are operating effectively in order to reduce the risk to an acceptable level or identify where
improvements to the system of internal control could be made. The Board’s monitoring covers all controls including financial, operational and
compliance controls and risk management. The following are examples of the key elements of the risk management framework:
•
Policies and procedures are in place, including the documentation of systems and rules relating to the delegation of authority, which allow the
monitoring of controls and restrict the unauthorised use of the Group’s assets. The Board led a thorough review of delegated authority limits
during the year;
•
Experienced and suitably qualified staff take responsibility for important business functions. Regular appraisal procedures have been established
to set objectives, measure performance and identify training needs. Belhaven has been accredited as an Investor in People since July 1999;
•
Forecasts and budgets are prepared which allow management to monitor the key operational and financial activities and risks and the progress
towards objectives set for the year. Management accounts are prepared promptly providing relevant, reliable and up-to-date financial and other
information; significant variances from budget are investigated as appropriate, and any necessary corrective action implemented and
monitored;
•
All investment projects are subject to formal authorisation procedures, with major investment projects requiring formal Board approval;
•
The directors review reports from management and from the external auditors throughout the year to provide reasonable assurance that
control procedures are in place and are being followed;
•
An internal audit function has been established to conduct regular reviews of financial processes, and procedures have been established for
instituting appropriate action to correct weaknesses identified from the above reports;
•
The Risk Register by division was thoroughly reviewed and updated during the year; and
•
The Board reviews in detail new and emerging industry risks. In the current year the Board has addressed the potential impact of the Scottish
Executive’s proposals to ban smoking in public places and their proposals to reform licensing laws.
The Board has reviewed the operation and effectiveness of the framework on a regular basis during the year.
AUDIT COMMITTEE
Roles and Responsibilities
The principal matters considered by the Audit Committee are:
•
External financial reporting and financial statements;
•
External audit arrangements;
•
Risk management and internal control procedures;
•
Internal audit arrangements and effectiveness; and
•
Whistleblowing procedures.
The Audit Committee’s terms of reference are available on the Group’s website.
Membership
The Audit Committee is chaired by Graeme Bissett, a qualified Chartered Accountant. The other member is Alistair Arkley. They are both
independent non-executive members. The table on page 23 shows the number of meetings and attendance at the meetings during the year. During
the year, the Group Chairman, Angus Meldrum, resigned as a member of the Audit Committee to ensure full compliance with the Combined Code,
which requires that all Audit Committee members should be independent non-executive directors.
The external auditors attended the two meetings and presented their programme for the forthcoming year, the results of their work on the interim
review and the year-end audit. Annual Report and Accounts 2005 25
CORPORATE GOVERNANCE STATEMENTS
The Audit Committee meetings are attended by the Finance Director, who acts as Secretary to the Committee. Towards the end of the meetings the
Finance Director leaves in order that the Committee can have a private discussion with the auditors. The Group Chairman and the Head of Internal
Audit also attend meetings as appropriate at the request of the Committee Chairman.
Main activities
The main activities of the Audit Committee are listed below.
•
The Audit Committee reviews and discusses the interim and annual financial statements, together with any report thereon from the external
auditors, including management letters and representation letters. During the year, the Audit Committee approved both the interim and annual
financial statements.
•
The Audit Committee considers the appointment of external auditors, including the rotation of the partner assigned to the audit. During the
May 2005 meeting the Audit Committee considered the effectiveness of the external auditors. The Audit Committee has reviewed the non-
audit services provided by Deloitte and Touche LLP and is satisfied that these do not impede their independence. Non-Audit fees are reviewed
to ensure an appropriate balance is achieved between maintaining objectivity and value for money, in accordance with Group policy.
•
The Audit Committee reviews:
i. The procedures for identifying business risks and controlling their financial impact on the Group;
ii. The means of ensuring that risk management procedures are regularly actioned by management, including the implementation and
monitoring of risk mitigation measures;
iii. The operation of delegated authority rules within the Group;
iv. The Group’s policies for detecting and preventing fraud;
v. The arrangements by which employees may, in confidence, raise concerns about possible improprieties in matters of formal reporting or
other areas;
vi. The Group’s policies for ensuring that it complies with relevant regulatory and legal requirements; and 
vii. The operational effectiveness of these policies and procedures including the external and internal audit arrangements.
•
During the year the Audit Committee paid particular attention to a review of delegated authority limits and the divisional risk register.
•
During the November 2004 meeting a presentation on internal audits carried out in the previous six months was made by the Head of Internal
Audit and senior management alongside details of proposed internal audits to be carried out over the following six months. The results of the
internal audits were reviewed at the May 2005 meeting.
Whistleblowing
The Audit Committee has reviewed the arrangements by which staff may, in confidence, raise concerns about possible improprieties in matters of
financial reporting, business practice, or other matters related to their working environment. To enable this the Group has a comprehensive
whistleblowing procedure. Employees can ask for their concerns to be treated in confidence. Disclosures cover specific areas of malpractice and
relate to the following actions:
i. A criminal offence;
ii. Failure to comply with a legal obligation;
iii. A miscarriage of justice;
iv. The endangering of an individual’s health and safety;
v. Damage to the environment; and
vi. Deliberate concealment of information relating to any of the above.
APPOINTMENTS TO THE BOARD AND ROLE OF THE NOMINATIONS COMMITTEE 
Roles and Responsibilities
The principal matters considered by the Nominations Committee are to assess and nominate suitable directors who have the mix of skills required
to fill Board vacancies as and when they arise, consider all matters relating to the size, structure and composition of the Board and oversee all Board
appointments.
Terms of reference for the Nominations Committee can be found on the Group’s website.
Membership
The Nominations Committee is chaired by Angus Meldrum and also comprises Stuart Ross and the two non-executive directors, Alistair Arkley,
and Graeme Bissett. CORPORATE GOVERNANCE STATEMENTS
26 The Belhaven Group plc
Board appointments
Graeme Bissett was appointed to the Board on 29 March 2004. Following interviews with the Committee it was agreed that he had the necessary
skills and experience and the use of external consultants or advertising was not required. In October 2004 the Committee appointed MacDonald
Kinnaird, recruitment consultants, to source suitable candidates for the position of Finance Director in advance of David Morrison’s retirement at
the end of March 2005. Ron Robson was appointed Finance Director on 4 April 2005. A comprehensive induction programme was carried out for
both appointees including meetings and discussions with advisors and senior management. The necessary arrangements to manage succession
issues promptly and effectively are in place.
GOING CONCERN 
Having discussed the business and its needs, the directors anticipate that the Company and the Group have adequate resources to continue in
operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial
statements.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES 
United Kingdom 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 Group and of the profit or loss of the Group for that year. 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; and 
•
state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial
statements.
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of
the Company and enable them to ensure that the accounts comply with the Companies Act 1985. They are also responsible for safeguarding the
assets of the Company and Group including taking reasonable steps for the prevention and detection of fraud and other irregularities. Annual Report and Accounts 2005 27
STATEMENT OF SOCIAL, ENVIRONMENTAL AND ETHICAL RESPONSIBILITY
BUSINESS ETHICS
The Board has made a clear commitment to operating all of the Group’s business activities to the highest standards of business ethics and integrity
and acting as a fair and reasonable employer. We also acknowledge and are keenly aware of our responsibilities to the many communities we serve,
our customers, suppliers, shareholders and to the environment.
BOARD RESPONSIBILITY
The Board has delegated the day-to-day responsibility for all matters related to Corporate Social, Environmental and Ethical Responsibility to the
executive directors. Specific responsibility for environmental issues has been delegated to Ian Herok, a senior executive.
Whilst recognising that the practices of recruitment, employment and training are the responsibility of all managers within the Group,
responsibility for formulating, updating and ensuring adherence to Group policies has been delegated to the Personnel Director who is responsible
to the Chief Executive.
Relationships with customers, suppliers and the community are determined at a local level by the managing directors of each operating division
who are responsible to the Chief Executive.
As part of the Board’s review of Corporate Governance at its February 2005 meeting, the directors also reviewed the Corporate Social,
Environmental and Ethical Responsibility Policy.
COMMUNITY INVOLVEMENT
As a multiple pub operator our businesses have an impact upon many local communities across the country. Belhaven is committed to playing an
active part in these communities and works to ensure that charitable funds are given to support worthwhile causes. Many of our staff give their
time and support to local causes and we encourage their participation in this. One example of fund raising carried out by the Group’s pubs was
£18,000 raised for the Tsunami appeal in January 2005.
The Group is a significant employer in the Dunbar area and has a responsibility to the local community through this and our operation of the
Brewery within the town itself. We provide direct support to the community through financial assistance to community events and encourage
participation by our people in these. Examples of community involvement in this area include sponsorship of local cultural and sporting events.
EMPLOYEE INVOLVEMENT
Our policy is to encourage and develop all members of staff to realise their maximum potential. Wherever possible, jobs are advertised on the
Group Intranet and internal notice boards so that the number of vacancies filled from within the Group is maximised and adequate opportunities
for internal promotion are created.
We support the principle of equal opportunities in employment and oppose all forms of unlawful or unfair discrimination on the grounds of race,
nationality, religion, ethnic or national origin, sexual orientation, gender or gender reassignment, marital status, age or disability.
It is also the policy of the Group to give full and fair consideration to the recruitment of disabled persons. Where disabled persons are employed,
their training, including training for alternative work of employees that become disabled, and development for promotion are encouraged and
assisted.
Belhaven is committed to a performance management and training and development programme, creating the opportunity for employees to
maintain and improve their performance and to develop their potential to the maximum.
The Group has been an Investor in People since July 1999 and carries out a bi-annual performance management review with individual objectives
being set for the following six months.
Personnel policies ensure that all employees are made aware on a regular basis of the Group’s policies, programmes and progress. Extensive use is
made of the Group Intranet and notice boards. The Company operates a number of share schemes as outlined in the Directors’ Remuneration Report
on pages 29 to 34.
ENVIRONMENT
Environmental responsibilities are dealt with conscientiously by the Group, based on the principle that responsible environmental activity is good
for both the business and the community. Regular account of environmental matters is taken and good practice is embedded into business
strategies and operations.
Both at a corporate and pub level the Group gets involved in environmental initiatives. These include the installation of a combined heat and power
plant to improve energy efficiency in the brewery and regular reviews and initiatives aimed at improving the environmental efficiency of our
operations. STATEMENT OF SOCIAL, ENVIRONMENTAL AND ETHICAL RESPONSIBILITY
28 The Belhaven Group plc
We seek continuous improvement in environmental matters. There are environmental management checks to ensure the Group complies with
regulations and national and local guidelines. These checks are an integral part of the business and help provide a safe and healthy environment for
employees, contractors, customers and neighbours.
As a Group, Belhaven ensures that:–
•
Environmental issues are regularly reviewed and policies and programmes are established to deal with specific issues where necessary;
•
The potential impact on the environment of new projects and developments is considered;
•
Environmental policies are implemented;
•
Management accountability and responsibility for environmental matters is maintained through divisional management boards;
•
Management programmes covering key environmental issues are developed and, where appropriate, targets are set;
•
The policy is communicated internally and, as appropriate, key employees are externally trained; and
•
Health and Safety matters are regularly reviewed.
RESPONSIBLE DRINKING AND HEALTH
One key challenge for our industry is the promotion of responsible consumption of alcohol. Moderate consumption provides social and health
benefits for the majority of the drinking population. However, there is a growing focus, both from regulators and within the industry, on the harm
caused both to the individual and to society by the irresponsible consumption of alcoholic drinks, including beer.
Belhaven has been actively engaged both meeting directly with politicians and regulators or working alongside industry organisations to ensure
that initiatives are evidence based and utilise examples of good practice from around the world. For example, the EU Commission will produce 
a report this year on “alcohol, health and the economy”, which will examine the economic and social burden of alcohol and its promotion in
member states.
In the area of marketing the Group is working to ensure that the industry as a whole is doing all that it can to uphold existing guidelines and codes
and where necessary to strengthen them.
Belhaven wishes to maximise profit whilst marketing and promoting alcoholic drinks in a responsible manner and believes the current regulatory
environment supports this approach. However, this will only continue if the whole industry works together and observes both the spirit as well as
the letter of all relevant guidelines and the codes of practice that underpin them. Belhaven believes that responsibility should be shown in the areas
where the Group has direct influence, in particular in marketing, advertising and promotion. Annual Report and Accounts 2005 29
DIRECTORS’ REMUNERATION REPORT
INTRODUCTION 
This report has been prepared in accordance with the Directors’ Remuneration Report Regulations 2002 (the Regulations). The report also meets the
relevant requirements of the Listing Rules of the Financial Services Authority and describes how the Board has applied the provisions of the
Combined Code relating to directors’ remuneration. As required by the Regulations, a resolution to approve the report will be proposed at the
Annual General Meeting of the Company at which the financial statements will be approved.
The Regulations require the auditors to report to the Company’s members on the “auditable part” of the report and to state whether in their opinion
that part of the report has been properly prepared in accordance with the Companies Act 1985 (as amended by the Regulations). The report has
therefore been divided into separate sections for unaudited and audited information.
UNAUDITED INFORMATION 
REMUNERATION COMMITTEE 
The Group has established a Remuneration Committee which is constituted in accordance with the recommendations of the Combined Code.
The members of the Committee are Alistair Arkley and Graeme Bissett who are both independent non-executive directors and the Committee is
chaired by Alistair Arkley. During the year, the Group Chairman, Angus Meldrum, resigned as a member of the Remuneration Committee to ensure
full compliance with the Combined Code, which requires that all Remuneration Committee members should be independent non-executive
directors. Terms of reference of the Remuneration Committee are available on the Group’s website.
None of the Committee has any personal financial interest in the Company (other than as shareholders), conflicts of interests arising from cross-
directorships or day-to-day involvement in running the business. The Committee makes recommendations to the Board. No director plays a part in
any discussion about his own remuneration.
In determining the directors’ remuneration for the year, the Committee consulted the Group Chairman and the Chief Executive about its proposals.
The Remuneration Committee is responsible for determining the remuneration of the directors and the divisional managing directors who are the
first layer of senior management below board level.
REMUNERATION POLICY 
Executive remuneration packages are prudently designed to attract, motivate and retain directors of a sufficiently high calibre.The performance
measurement of the executive directors and the determination of their annual remuneration package are undertaken by the Committee.
The remuneration of the non-executive directors is determined by the Board as a whole, having regard to the current market conditions.
There are four main elements of the remuneration package for executive directors:
•
Basic annual salary and benefits;
•
Annual bonuses;
•
Long term incentive plans; and
•
Pension arrangements.
The Group’s policy is that a substantial proportion of the remuneration of the executive directors should be performance related. As described
below, executive directors may earn annual bonus payments together with the benefits of participation in long term incentive plans. Executive
directors are not entitled to accept appointments outside the Group except where prior permission has been granted by the Board.
The Group has not granted share option incentives to directors since 28 August 2002.
BASIC ANNUAL SALARY AND BENEFITS
An executive director’s basic salary is determined by the Committee prior to the beginning of each financial year and when an individual changes
position or responsibility. In deciding appropriate levels, the Committee from time to time considers up-to-date information on comparative
companies provided by independent third parties. Stuart Ross’ basic salary was reviewed in March 2005 with a 4% increase taking effect from 
1 April 2005. Executive directors’ contracts of service will be available for inspection at the Annual General Meeting.
In addition to the basic salary, the executive directors receive certain benefits in-kind, principally a car and private medical insurance. ANNUAL BONUSES
The Committee establishes the objectives that must be met for each financial year if a performance related cash bonus is to be paid. In setting
appropriate bonus parameters the Committee considers the relevant corporate performance objectives. The Committee believes that any incentive
awarded should be tied to the interest of the Company’s shareholders and that the principal measure of those interests is total profit growth.
The maximum performance related bonus is ordinarily 50% of the director’s basic annual salary but in light of the exceptional performance of the
Group, the Remuneration Committee used their discretion to remove this restriction for Stuart Ross in 2005 which resulted in an additional bonus
of £16,000. His total bonus for the year represented 58% of salary.
Payments made under the annual bonus scheme do not form part of pensionable earnings.
LONG TERM INCENTIVE PLANS
On 13 July 2001, the Annual General Meeting of the Company approved the creation of a Long Term Incentive Plan (LTIP) available to executive
directors and senior executives. The purpose of the LTIP is to retain the services of executive directors and senior executives and to reward their
loyalty, subject to tough performance targets being met in the Group as a whole, or in the division or subsidiary of the Group in which the
participant has an involvement.
Under the LTIP, individuals may be granted an award annually by the Remuneration Committee, the vesting of which will be subject to the
attainment of pre-determined performance conditions measured over a three year period. The cash element of the LTIP vests three years after the
date of the grant and the share element vests four years after the date of the grant. The performance conditions for executive directors in respect
of LTIPs already issued are Group earnings per share growth of more than RPI + 8% per annum compound and net asset value growth of more than
10% per annum compound. Awards are intended to deliver a pre-determined cash payment and a number of shares which will be fixed by reference
to the market price of the Company’s shares at the date of the grant. The maximum value of the award as at the date of grant can be no more than
100% of a participant’s annual base salary at that date.
Payments made under the LTIP do not form part of pensionable earnings. No LTIP share awards vested to executive directors during the year ended
3 April 2005. LTIP cash awards which vested in the year are set out in the details of directors’ remuneration below.
PENSION ARRANGEMENTS 
Executive directors are members of the Group pension scheme. Their spouses are eligible for spouses pensions and a lump sum is payable in the
event of death in service to named beneficiaries. The pension arrangements provide for a pension on retirement of 1/60 basic annual salary per year
of eligible service, subject to HM Customs & Revenue rules. No other payments to directors are pensionable.
In addition, the Group contributes in respect of each of the executive directors a sum equal to 7.7% of the basic annual salary, by equal monthly
contributions, into Money Purchase Individual Executive Plans administered by an insurance company.
SHARE OPTIONS 
In addition to the four elements noted above, the executive directors have historically had options granted to them under the terms of the 1996
Approved and Unapproved Share Option Schemes which are open to all qualifying employees. Under these schemes options are allocated to
qualifying employees by reference to the seniority of their positions within the Group. The exercise of options granted under these schemes is
dependent upon a performance criterion which is discussed below.
The Committee has responsibility for the grant of options under the terms of these schemes.
The performance criterion which must be met requires the Group’s earnings per share to outperform the Retail Price Index by at least 3% per
annum over a period of three years from the date the option was granted. Thereafter the option may be exercised during the rest of its life without
further test. The performance criterion, which applies to all executive directors to whom options have been granted under these schemes, was
chosen to align the reward of the directors with the interest of shareholders.
The exercise price of the options granted under the above schemes is equal to the market value of the Company’s shares at the time when the
options are granted. The Group also operates a SAYE Share Option Scheme for qualifying employees under which options may be granted at a
discount of up to 20% of market value. The executive directors are eligible to participate in the SAYE Share Option Scheme.
The Group’s policy is to grant options to the directors at the discretion of the Remuneration Committee taking into account individual
performance. No significant amendments are proposed to be made to the terms and conditions of any entitlement of a director to share options.
No share options were awarded to directors during the years ended 28 March 2004 and 3 April 2005.
DIRECTORS’ REMUNERATION REPORT
30 The Belhaven Group plc Annual Report and Accounts 2005 31
DIRECTORS’ REMUNERATION REPORT
PERFORMANCE GRAPH 
5 Year Return Index for The Belhaven Group plc as at 3 April 2005.
The graph shows the Company’s performance, measured by total shareholder
return, compared with the performance of the FTSE small cap and the FTSE
leisure and hotels indices also measured by total shareholder return.
These indices have been selected for this comparison because the Board
considers them to be the most relevant available comparisons.
DIRECTORS’ CONTRACTS 
It is the Group’s policy that executive directors should have, where possible, contracts with an indefinite term providing for a maximum of one
year’s notice. Stuart Ross’ contract of employment carries a period of notice of two years. The Board believes that it is desirable to maintain this
long-standing period of notice and does not consider the benefit of reducing this to one year justifies the cost to shareholders of achieving it.
The Chairman has contacted a cross-section of shareholders and they have agreed with our explanation. A future Chief Executive will have a one
year contract. Other executive directors have contracts which are subject to one year’s notice by either party.
The details of directors’ contracts are summarised in the table below:
Date of Notice
NAME OF DIRECTOR contract Period
Stuart Ross 3 July 1996 Two years
David Morrison 3 July 1996 One year
Ron Robson, who was appointed on 4 April 2005, has a contract with a notice period of one year.
In the event of early termination, the executive directors’ contracts provide for compensation up to a maximum of basic salary and the gross value
of all other contractual benefits for the notice period.
NON-EXECUTIVE DIRECTORS 
All non-executive directors have specific terms of engagement and their remuneration is determined by the Board having regard to current market
conditions and their anticipated time commitment. The fees paid to each non-executive director in the year are disclosed in the table below.
Non-executive directors cannot participate in any of the Company’s share option schemes and are not eligible to join the Group’s pension scheme.
OTHER DIRECTORSHIPS OF THE EXECUTIVE DIRECTORS
Stuart Ross is the non-executive chairman of Montpeliers (Edinburgh) Limited but has no shareholding in that company. During 2005, he received a
fee of £12,500 all of which has been retained.
AUDITED INFORMATION 
AGGREGATE DIRECTORS’ REMUNERATION 
The total amounts for directors’ remuneration were as follows:
2005 2004
£’000 £’000
Emoluments 573 1,030
Gains on exercise of share options 344 132
Cash amounts vested under long-term incentive schemes 59 –
Money purchase pension contributions 24 46
1,000 1,208
350
300
250
200
150
100
50
0
2000 2001 2002 2003 2004 2005
BELHAVEN GROUP – TOTAL RETURN INDEX
FTSE SMALL CAP – PRICE INDEX
FTSE LEISURE & HOTELS – TOTAL RETURN INDEX  (Source: DATASTREAM) DIRECTORS’ REMUNERATION REPORT
32 The Belhaven Group plc
DIRECTORS’ EMOLUMENTS
Taxable Total Total Total
NAME OF DIRECTOR Fees Salary bonus benefits 2005 2004
£’000 £’000 £’000 £’000 £’000 £’000
EXECUTIVE:
Stuart Ross – 205 119 9 333 282
David Morrison (resigned 31 March 2005) – 105 53 13 171 164
Ian Herok (resigned 26 March 2004) – – – – N/A 152
Bill Hughes (resigned 26 March 2004) – – – – N/A 139
Jeff Myers (resigned 26 March 2004) – – – – N/A 237
NON-EXECUTIVE:
Angus Meldrum 24 – – – 24 18
Alistair Arkley 20 – – – 20 18
Graeme Bissett 20 – – – 20 –
Chris Greig (resigned 16 July 2004) 5––– 5 20
69 310 172 22 573 1,030
Fees to Alistair Arkley were paid to New Century Inns Ltd under an agreement to provide the Group with his services.
Fees to Angus Meldrum were paid to Lochgreen Consultants under an agreement to provide the Group with his services.
The Group contributes in respect of each of the executive directors a sum equal to 7.7% of the gross salary excluding bonus, by equal monthly
contributions, into Money Purchase Individual Executive Pension Plans administered by an insurance company.
LONG TERM INCENTIVE PLANS 
Interest Awarded Vested Interest
at 28 March 2004 during year during year at 3 April 2005
NAME OF DIRECTOR Shares Cash Shares Cash Shares Cash Shares Cash
£’000 £’000 £’000 £’000
Stuart Ross 27,664 77 2,196 – – 36 29,860 41
David Morrison 9,297 23 – – – 23 9,297 –
36,961 100 2,196 – 59 39,157 41
The executive directors were granted an award of 50% of basic salary under the LTIP on 13 July 2001 related to the performance of the Group,
for the three year period to 28 March 2004. The performance criteria were met during this period. The market price of the Company’s shares at 
13 July 2001 was 242p.
Stuart Ross was granted a further award of 50% of basic salary on 12 July 2002 on the same performance conditions as the award made on 13 July
2001 but for the three year period to 3 April 2005. The performance criteria were met during the period. The market price of the Company’s shares
at 12 July 2002 was 325p.
The cash element of the LTIP vests three years after the date of the grant and the share element vests four years after the date of the grant.
The closing interest of the directors is dependent on meeting the performance criteria in the three year period to which the award is related.
The interest in 2,196 shares awarded to Stuart Ross during the year was made in accordance with the co-investment provisions of the LTIP scheme.
Under this, the Company will match on a “1 for 1” basis any investment in the Company’s shares made from cash vesting under the LTIP in the year
up to an amount equal to 50% of the cash vested.
Further details on the performance criteria are provided on page 30. Annual Report and Accounts 2005 33
DIRECTORS’ REMUNERATION REPORT
DIRECTORS’ SHARE OPTIONS 
Aggregate emoluments disclosed above do not include any amounts for the value of options to acquire ordinary shares in the Company granted to
or held by the directors. Details of performance criteria are provided on page 30. Details of the options are as follows:
Unexercised at Unexercised at
NAME OF DIRECTOR 28 March 2004 3 April 2005
Stuart Ross 63,667 3,667
David Morrison 63,667 3,667
The non-executive directors, Angus Meldrum, Alistair Arkley and Graeme Bissett hold no options to subscribe for ordinary shares in the Company.
All options are for ordinary shares of 10p each.
Details of the options exercised for directors who served during the year are as follows:
Market Gains on Gains on
Number of Exercise price at exercise exercise
options price exercise date 2005 2004
NAME OF DIRECTOR Scheme (pence) (pence) £’000 £’000
Stuart Ross Approved –––– 32
Unapproved 20,000 194.5 473.0 56 –
Unapproved 40,000 181.0 473.0 116 –
David Morrison Approved –––– 32
Unapproved 20,000 194.5 473.0 56 –
Unapproved 40,000 181.0 473.0 116 –
344 64
Details of options for directors who served during the year are as follows:
Exercise
Name/ 28 March 3 April price
Scheme Date of grant 2004 Granted Exercised 2005 (pence) Period of exercise
Stuart Ross
Unapproved 17 July 2000 20,000 – 20,000 – 194.5 17 July 2003 – 2007
Unapproved 15 Jan 2001 40,000 – 40,000 – 181.0 15 Jan 2004 – 2008
SAYE 28 Aug 2002 3,667 – – 3,667 258.0 1 Oct 2005 – 31 Mar 2006
David Morrison
Unapproved 17 July 2000 20,000 – 20,000 – 194.5 17 July 2003 – 2007
Unapproved 15 Jan 2001 40,000 – 40,000 – 181.0 15 Jan 2004 – 2008
SAYE 28 Aug 2002 3,667 – – 3,667 258.0 1 Oct 2005 – 31 Mar 2006
There have been no variations to the terms and conditions or performance criteria for share options during the financial year. For the Approved and
Unapproved Schemes the performance criterion that must be met requires the Group’s earnings per share to outperform the Retail Price Index by at
least 3% per annum over a period of three years from the date the option was granted. Thereafter the option may be exercised during the rest of its
life without further test.
The market price of the ordinary shares at 3 April 2005 was 437.5p and the range during the year was 402.5p to 487.5p. DIRECTORS’ REMUNERATION REPORT
34 The Belhaven Group plc
DIRECTORS’ PENSION ENTITLEMENTS 
Two directors are members of the Group’s defined benefit pension scheme and had accrued entitlements under the scheme as follows:
Accrued Accrued
pension at Increase in pension at
28 March 2004 accrued pension 3 April 2005
£’000 £’000 £’000
Stuart Ross 95 14
David Morrison 20 4 24
The following table sets out the transfer value of the directors’ accrued benefits under the scheme calculated in a manner consistent with
‘Retirement Benefit Schemes - Transfer Values (GN 11)’ published by the Institute of Actuaries and the Faculty of Actuaries.
Increase
in transfer
Transfer value (less Transfer
value at directors’ Directors’ value at
28 March 2004 contributions) contributions 3 April 2005
£’000 £’000 £’000 £’000
Stuart Ross 139 101 10 250
David Morrison 284 104 6 394
The transfer values disclosed above do not represent a sum paid or payable to the individual director. Instead they represent a potential liability of
the pension scheme.
Members of the scheme have the option to pay Additional Voluntary Contributions. No contributions have been made under this option.
Two directors are members of a money purchase scheme. Contributions paid by the Group were as follows:
2005 2004
£’000 £’000
Stuart Ross 16 14
David Morrison 8 8
24 22
APPROVAL
The report was approved by the Board on 6 June 2005 and signed on its behalf by:
Alistair Arkley
Chairman
Remuneration Committee
6 June 2005 Annual Report and Accounts 2005 35
INDEPENDENT AUDITORS’ REPORT
TO THE MEMBERS OF THE BELHAVEN GROUP PLC
We have audited the financial statements of The Belhaven Group plc for the year ended 3 April 2005 which comprise the profit and loss account,
the statement of total recognised gains and losses, the note of historical cost profits and losses, the balance sheets, the cash flow statement, the
statement of accounting policies and the related notes 1 to 26. These financial statements have been prepared under the accounting policies set
out therein. We have also audited the information in the part of the directors’ remuneration report that is described as having been audited.
This report is made solely to the Company’s members, as a body, in accordance with section 235 of the Companies Act 1985. Our audit work has
been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditors’ report and for
no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the
Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described in the statement of directors’ responsibilities, the Company’s directors are responsible for the preparation of the financial statements
in accordance with applicable United Kingdom law and accounting standards. They are also responsible for the preparation of the other information
contained in the annual report including the directors’ remuneration report. Our responsibility is to audit the financial statements and the part of
the directors’ remuneration report described as having been audited in accordance with relevant United Kingdom legal and regulatory requirements
and auditing standards.
We report to you our opinion as to whether the financial statements give a true and fair view and whether the financial statements and the part of
the directors’ remuneration report described as having been audited have been 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
regarding directors’ remuneration and transactions with the Company and other members of the Group is not disclosed.
We review whether the corporate governance statement reflects the Company’s compliance with the nine provisions of the July 2003 FRC
Combined Code specified for our review by the Listing Rules of the Financial Services Authority, 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 directors’ report and the other information contained in the annual report for the above year as described in the contents section
including the unaudited part of the directors’ remuneration report and consider the implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the financial statements.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with United Kingdom 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 and the part of the directors’
remuneration report described as having been audited. 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 circumstances of the
Company and the Group, 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 and the part of the directors’ remuneration report described as
having been audited are free from material misstatement, 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 and the part of the directors’ remuneration report
described as having been audited.
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 3 April 2005 and of the profit of the
Group for the year then ended; and
•
the financial statements and part of the directors’ remuneration report described as having been audited have been properly prepared in
accordance with the Companies Act 1985.
Deloitte & Touche LLP
Chartered Accountants and Registered Auditors
Edinburgh
6 June 2005 CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 3 APRIL 2005
36 The Belhaven Group plc
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
Notes £’000 £’000
TURNOVER 1 114,438 94,957
Cost of sales (55,033) (46,513)
GROSS PROFIT 59,405 48,444
Net operating expenses 2 (38,946) (31,840)
OPERATING PROFIT 1 20,459 16,604
Investment income 5 656 297
Interest payable and similar charges 6 (3,687) (2,670)
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 3 17,428 14,231
Tax on profit on ordinary activities 7 (4,453) (4,127)
PROFIT FOR THE FINANCIAL YEAR 12,975 10,104
Dividends paid and proposed on equity shares 8 (3,697) (3,300)
RETAINED PROFIT FOR THE FINANCIAL YEAR 19 9,278 6,804
EARNINGS PER SHARE
Basic 9 43.7p 37.2p
Diluted 9 43.5p 36.8p
DIVIDEND PER SHARE
Interim paid 8 4.35p 3.95p
Final proposed 8 8.00p 7.25p
The current year and preceding year results have been derived wholly from continuing operations.
The accompanying notes form an integral part of this consolidated profit and loss account. Annual Report and Accounts 2005 37
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 3 APRIL 2005
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Profit for the financial year 12,975 10,104
Revaluation surplus 4,427 –
TOTAL RECOGNISED GAINS AND LOSSES RELATING TO THE YEAR 17,402 10,104
A statement of movement in reserves is given in Note 19.
The accompanying notes form an integral part of this consolidated statement of total recognised gains and losses.
CONSOLIDATED NOTE OF HISTORICAL COST PROFITS AND LOSSES
FOR THE YEAR ENDED 3 APRIL 2005
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Reported profit on ordinary activities before taxation 17,428 14,231
Realisation of property revaluation losses of previous year (91) (470)
Difference between the historical cost depreciation charge 
and the actual depreciation charge for the year 19 19
HISTORICAL COST PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 17,356 13,780
HISTORICAL COST PROFIT FOR THE YEAR RETAINED AFTER TAXATION AND DIVIDENDS 9,206 6,353 38 The Belhaven Group plc
BALANCE SHEETS
AS AT 3 APRIL 2005
GROUP COMPANY
3 April 28 March 3 April 28 March
2005 2004 2005 2004
Notes £’000 £’000 £’000 £’000
FIXED ASSETS
Goodwill 10 764 866 – –
Tangible assets 11 154,136 122,670 – –
Investments 12 20,276 15,615 94,073 88,022
175,176 139,151 94,073 88,022
CURRENT ASSETS
Stocks 13 3,054 2,714 – –
Debtors 14 8,396 7,747 – 2
Investments 12 3,825 6,020 – –
Cash at bank and in hand 23 230 205 113 504
15,505 16,686 113 506
CREDITORS:
Amounts falling due within one year 15 (56,760) (24,819) (23,506) (3,638)
NET CURRENT LIABILITIES (41,255) (8,133) (23,393) (3,132)
TOTAL ASSETS LESS CURRENT LIABILITIES 133,921 131,018 70,680 84,890
CREDITORS:
Amounts falling due after more than one year 16 (31,198) (43,402) (18,000) (34,000)
PROVISIONS FOR LIABILITIES AND CHARGES 17 (7,843) (7,205) – –
NET ASSETS 1 94,880 80,411 52,680 50,890
CAPITAL AND RESERVES
Called–up equity share capital 18 2,985 2,949 2,985 2,949
Share premium 19 46,358 45,721 46,358 45,721
Revaluation reserve 19 9,219 4,720 – –
Profit and loss account 19 36,318 27,021 3,337 2,220
EQUITY SHAREHOLDERS’ FUNDS 20 94,880 80,411 52,680 50,890
Signed on behalf of the Board
Stuart Ross, Director, 6 June 2005 Ron Robson, Director, 6 June 2005
The accompanying notes form an integral part of these balance sheets. Annual Report and Accounts 2005 39
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 3 APRIL 2005
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
Notes £’000 £’000
NET CASH INFLOW FROM OPERATING ACTIVITIES 21 25,290 20,822
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE 21 (3,031) (2,373)
TAXATION 21 (4,120) (2,488)
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT 21 (31,966) (34,174)
EQUITY DIVIDENDS PAID (3,447) (2,697)
CASH OUTFLOW BEFORE FINANCING (17,274) (20,910)
FINANCING 21 5,795 24,570
INCREASE/(DECREASE) IN CASH IN THE YEAR 22 (11,479) 3,660
The accompanying notes form an integral part of this consolidated cash flow statement. STATEMENT OF ACCOUNTING POLICIES
40 The Belhaven Group plc
A summary of the principal accounting policies, all of which have been applied consistently throughout the year and the preceding year, is set out below.
BASIS OF ACCOUNTING
The accounts have been prepared under the historical cost convention, as modified by the revaluation of certain fixed assets. The accounts have
been prepared in accordance with applicable United Kingdom accounting standards.
BASIS OF CONSOLIDATION
The Group accounts consolidate the accounts of The Belhaven Group plc and its subsidiary undertakings, drawn up to 3 April 2005.The results of
subsidiaries acquired or sold are consolidated for the periods from or to the date on which control passed.
TANGIBLE FIXED ASSETS 
Tangible fixed assets are shown at their original cost or subsequent valuation less depreciation and provision for impairment.
Depreciation is provided at rates calculated to write off the cost or valuation, less estimated residual value, of the following classes of asset on a
straight-line basis over their expected useful lives as follows:
Freehold buildings 50 years
Leasehold buildings Length of lease (maximum 50 years)
Plant 10 to 50 years
Kegs and barrels 10 years
Fixtures, fittings and other equipment 4 to 10 years
No depreciation is provided on land.
REVALUATION OF PROPERTIES
The public house estate is revalued every third and fifth year by professional valuers. Further interim valuations are performed where it is likely that
there has been a material change in the value of any individual properties. The resulting surplus or deficit is transferred to the revaluation reserve,
except that a deficit which is in excess of any previously recognised surplus over depreciated cost relating to the same property, or the reversal of
such a deficit, is charged (or credited) to the profit and loss account unless it can be demonstrated that the recoverable amount of the asset is
greater than its revalued amount, in which case the loss is recognised in the statement of total recognised gains and losses to the extent that the
recoverable amount of the asset is greater than its revalued amount. A deficit which represents a clear consumption of economic benefits is
charged to the profit and loss account regardless of any such previous surplus. Where depreciation charges are increased following a revaluation,
an amount equal to the increase is transferred annually from the revaluation reserve to the profit and loss account as a movement on reserves.
On the disposal or recognition of a provision for impairment of a revalued fixed asset, any related balance remaining in the revaluation reserve is
also transferred to the profit and loss account as a movement on reserves.
The directors review the residual value of licensed properties on a periodic basis.
INVESTMENTS
Fixed asset investments are shown at cost less provision for impairment. Current asset investments are stated at the lower of cost and net
realisable value.
INTANGIBLE ASSETS – GOODWILL
Goodwill arising on the acquisition of subsidiary undertakings and businesses, representing any excess of the fair value of the consideration given
over the fair value of the identifiable assets and liabilities acquired, is capitalised and written off on a straight line basis over its useful economic life
of ten years. Provision is made for any impairment.
Goodwill arising on acquisitions in the year ended 30 March 1997 and earlier periods was written off to reserves in accordance with the accounting
standard then in force. As permitted by the current accounting standard the goodwill previously written off to reserves has not been reinstated in
the balance sheet. On disposal or closure of a previously acquired business, the attributable amount of goodwill previously written off to reserves is
included in determining the profit or loss on disposal.
TRADE LOANS
Trade loans are included in the balance sheet as investments and are allocated between fixed and current assets in accordance with their
repayment schedules.
Sums guaranteed in relation to trade loans made by third party banks under the terms of joint finance schemes are not reflected in the balance
sheet but are separately disclosed as to their nature and amount (note 24).
STOCKS
Stocks are valued at the lower of cost and net realisable value.
Cost incurred in bringing each product to its present location and condition is based on:
– for raw materials, consumables and goods for resale:
purchase costs (on a first in, first out basis) 
– for finished goods:
costs of material and labour
Net realisable value is based on estimated normal selling price, less further costs expected to be incurred to completion and disposal. Provision is
made for obsolete, slow moving or defective items where appropriate. Annual Report and Accounts 2005 41
STATEMENT OF ACCOUNTING POLICIES
DEBT
Debt is initially stated at the amount of the net proceeds after deduction of issue costs. The carrying amount is increased by the finance cost in
respect of the accounting period and reduced by payments made in the period.
TURNOVER
Turnover represents amounts received and receivable, excluding VAT, before deduction of retrospectively – payable discounts (which are also
dependent on prompt settlement), for beer and other drinks supplied in the normal course of business, as well as retail sales from managed houses
and rental income from the tenanted estate.
PENSION COSTS
The amount charged to the profit and loss account in respect of the Group’s defined benefit scheme is the estimated regular cost of providing the
benefits accrued in the year, adjusted to reflect variations from that cost. The regular cost is calculated so that it represents a substantially level
percentage of current and future pensionable payroll.Variations from regular cost are charged or credited to the profit and loss account over the
estimated average remaining working life of the scheme members.
For defined contribution schemes the amount charged to the profit and loss account in respect of pension costs is the contributions payable in 
the year.
LEASING COMMITMENTS
Assets held under finance leases are initially reported at the fair value of the asset, with an equivalent liability categorised as appropriate under
creditors due within or after one year. The asset is depreciated over the shorter of the economic life of the asset and the period of the lease
(including the secondary period). Finance costs are allocated to accounting periods over the period of the lease to produce a constant rate of charge
on the outstanding balance.
Rentals under operating leases are charged to the profit and loss account on a straight-line basis over the lease term, even if the payments are not
made on such a basis.
FINANCE COSTS
Finance costs of debt are recognised in the profit and loss account over the term of the instruments in accordance with contractual commitments.
FINANCIAL DERIVATIVES
The Group uses derivative financial instruments to reduce exposure to interest rate movements. The Group does not hold or issue derivative
financial instruments for speculative purposes.
For an interest rate swap to be treated as a hedge the instrument must be related to actual assets or liabilities or a probable commitment and must
change the nature of the interest rate by converting a variable rate to a fixed rate. Interest differentials under these swaps are recognised by
adjusting net interest payable over the periods of the contracts.
If an instrument ceases to be accounted for as a hedge, for example because the underlying hedged position is eliminated, the instrument is fair
valued and any resulting profit or loss recognised at that time.
TAXATION
Current tax, including UK corporation tax, is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been
enacted or substantially enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the balance sheet date.
Timing differences are differences between the Group’s taxable profits and its results as stated in the financial statements that arise from the
inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the financial statements.
Deferred tax is not recognised when fixed assets are revalued unless by the balance sheet date there is a binding agreement to sell the revalued
assets and the gain or loss expected to arise on sale has been recognised in the financial statements. Neither is deferred tax recognised when fixed
assets are sold and it is more likely than not that the taxable gain will be rolled over, being charged to tax only if and when the replacement assets
are sold.
Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the timing differences are expected to 
reverse, based on tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax is measured on a 
non-discounted basis. NOTES TO THE ACCOUNTS
42 The Belhaven Group plc
1. SEGMENTAL INFORMATION
All turnover, profit and net assets relate to products supplied from the UK. The vast majority of business is conducted within the UK.
For the purposes of presenting the accounts, the Group recognises two business segments; managed and tenanted public houses, “Belhaven
Pubs”, and beer brewing and drinks distribution, “Belhaven Drinks”.
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
TURNOVER
Belhaven Pubs 58,680 44,276
Belhaven Drinks 55,758 50,681
114,438 94,957
OPERATING PROFIT
Belhaven Pubs 15,104 11,811
Belhaven Drinks 8,587 7,941
Central costs (3,232) (3,148)
20,459 16,604
Interest payable, less interest receivable (3,031) (2,373)
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 17,428 14,231
NET ASSETS
Belhaven Pubs 138,254 109,622
Belhaven Drinks 19,298 17,601
Unallocated items (62,672) (46,812)
94,880 80,411
Unallocated items comprise bank loans and overdrafts £52,088,000 (2004: £36,584,000), deferred tax and provisions £7,777,000 
(2004: £7,567,000), dividend payable £2,388,000 (2004: £2,138,000) and corporate accruals £419,000 (2004: £523,000).
Turnover in the United Kingdom for managed and tenanted public houses includes the following:
Rental income from tenanted estate 3,385 2,567
2. NET OPERATING EXPENSES
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Distribution costs 3,647 3,296
Administrative expenses 37,230 30,230
Other operating income (1,931) (1,686)
38,946 31,840
Administrative expenses include £102,000 of goodwill amortisation (2004: £100,000). Annual Report and Accounts 2005 43
NOTES TO THE ACCOUNTS
3. PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION
Profit on ordinary activities before taxation is stated after charging:
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Depreciation and amounts written off tangible fixed assets
– owned 2,475 2,168
– held under finance leases 148 145
Gain on sale of tangible fixed assets (162) (8)
Operating lease rentals
– plant and machinery 129 132
– motor vehicles 861 783
– land and buildings 389 391
Auditors’ remuneration – audit fees 46 40
Hire of commercial vehicles 45 46
In addition to the auditors’ remuneration shown above, the aggregate fees paid for non-audit services were £8,000 for specialist tax advice
(2004: £60,000 relating to work performed as reporting accountants on the Firm Placing and Placing and Open Offer, and £23,000 in respect 
of tax services).
4. STAFF COSTS
Particulars of employees (including directors) costs are shown below:
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Wages and salaries 16,993 13,752
Social security costs 1,195 981
Other pension costs 700 580
18,888 15,313
The average monthly number of persons employed by the Group was as follows:
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
Number Number
Administration, distribution and retail 1,072 913
Production 41 38
1,113 951
Details of directors’ remuneration for the year are provided in the audited part of the Directors’ Remuneration Report on pages 31 to 34.
5. INVESTMENT INCOME
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Interest receivable from trade loans 656 297 NOTES TO THE ACCOUNTS
44 The Belhaven Group plc
6. INTEREST PAYABLE AND SIMILAR CHARGES
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
On bank loans and overdraft 3,658 2,623
On finance leases 29 47
3,687 2,670
7. TAX ON PROFIT ON ORDINARY ACTIVITIES
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
The tax charge is based on the profit for the year and comprises:
Corporation tax at 30% (2004: 30%) 3,439 2,562
Adjustment of current taxation in respect of prior years 76 –
Total current tax 3,515 2,562
Origination and reversal of timing differences 1,600 1,565
Adjustment of deferred tax in respect of prior years (662) –
Total deferred tax 938 1,565
Total tax on profit on ordinary activities 4,453 4,127
The differences between the total current tax shown above and the amount calculated by applying the standard rate of UK corporation tax to
the profit before tax is as follows:
Profit on ordinary activities before tax 17,428 14,231
Tax on profit on ordinary activities at standard UK corporation tax rate of 30% (2004: 30%) 5,228 4,269
Effects of
Permanent book to tax differences (189) (142)
Capital allowances in excess of depreciation (1,600) (1,565)
Adjustments to tax charge in respect of previous periods 76 –
Total current tax, as above 3,515 2,562
The amount of deferred tax that has not been provided on revalued fixed assets is £2,000,000 (2004: £1,000,000). At present, it is not envisaged
that any tax will become payable in the foreseeable future.
The Group’s planned level of capital expenditure is expected to remain at similar levels, therefore it expects to be able to claim capital
allowances in excess of depreciation in future years. Annual Report and Accounts 2005 45
NOTES TO THE ACCOUNTS
8. DIVIDENDS PAID AND PROPOSED ON EQUITY SHARES
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Equity shares
Ordinary shares – interim paid of 4.35p (2004: 3.95p) per share 1,309 1,162
Ordinary shares – final proposed of 8.00p (2004: 7.25p) per share 2,388 2,138
3,697 3,300
9. EARNINGS PER SHARE
The calculations of basic and diluted earnings per share are based on the profit after taxation for the year and the following number of shares:
2005 2004
Number of Number of
shares shares
Weighted average number of shares for basic earnings per share 29,706,471 27,168,770
Notional exercise of share options 141,382 301,532
Number of shares for diluted earnings per share 29,847,853 27,470,302
10. GOODWILL
The movement in goodwill during the year was as follows:
£’000
GROUP
Cost
Beginning of year 1,166
End of year 1,166
Amortisation
Beginning of year (300)
Charge (102)
End of year (402)
Net book value
Beginning of year 866
End of year 764
The Company has no goodwill at 3 April 2005 or 28 March 2004. NOTES TO THE ACCOUNTS
46 The Belhaven Group plc
11. TANGIBLE FIXED ASSETS
Freehold Leasehold Fixtures,
land & land & fittings & Kegs &
buildings buildings Plant equipment barrels Total
£’000 £’000 £’000 £’000 £’000 £’000
GROUP
Cost or valuation
Beginning of year 111,025 5,772 7,038 10,078 1,100 135,013
Additions 28,051 316 332 1,668 124 30,491
Revaluation 4,177 (765) – – – 3,412
Disposals (831) – – (130) – (961)
End of year 142,422 5,323 7,370 11,616 1,224 167,955
Depreciation
Beginning of year (1,879) (171) (3,362) (6,234) (697) (12,343)
Disposals 2 – – 130 – 132
Revaluation 645 370––– 1,015
Charge (512) (199) (411) (1,429) (72) (2,623)
End of year (1,744) – (3,773) (7,533) (769) (13,819)
Net book value
Beginning of year 109,146 5,601 3,676 3,844 403 122,670
End of year 140,678 5,323 3,597 4,083 455 154,136
The book value of land, which was not subject to depreciation, at the year end was £33,800,000 (2004: £26,300,000).
The net book value of the public house estate at 3 April 2005 was £141,368,000 (2004: £111,235,000).
The Group’s public house estate was valued as at 3 April 2005 by Graham & Sibbald. The basis of the valuation was open market value for
existing use and the value thereof, including any lotting premium, was incorporated by the directors.
If land and buildings had not been revalued they would have been included at the following amounts:
2005 2004
Freehold Leasehold Freehold Leasehold
land & land & land & land &
buildings buildings buildings buildings
£’000 £’000 £’000 £’000
GROUP
Cost 131,137 7,603 105,045 7,287
Depreciation (2,706) (993) (2,056) (794)
Net book value 128,431 6,610 102,989 6,493
Included in the above are assets held under finance leases as follows:
Freehold
land &
buildings Plant Total
£’000 £’000 £’000
Net book value
Beginning of year 141 1,587 1,728
End of year 139 1,441 1,580
The Company did not own any tangible fixed assets at 3 April 2005 or 28 March 2004. Annual Report and Accounts 2005 47
NOTES TO THE ACCOUNTS
12. FIXED ASSET INVESTMENTS
The following are included in the net book value of fixed asset investments:
2005 2004
£’000 £’000
GROUP
Trade loans and advance discounts
Beginning of year 21,635 16,277
Advanced 17,408 14,093
Repaid (14,942) (8,735)
End of year 24,101 21,635
Repayable within one year included in current assets (3,825) (6,020)
20,276 15,615
Most of the above trade loans and advance discounts are secured by a standard charge over properties owned by the trade customers.
Shares in Loans to
subsidiary subsidiary
undertakings undertakings Total
£’000 £’000 £’000
COMPANY
Beginning of year 19,574 68,488 88,022
End of year 19,574 74.499 94,073
The Company has investments in the following subsidiary undertakings which principally affected the profits and net assets of the Group:
Country of Share capital Proportion
operation Nature of business class held
Belhaven Brewery Company Limited Scotland Retail management and Ordinary 100%
leasing of public houses and
Brewing, packaging and
distribution of beer products
Belhaven Finance Limited Scotland Provision of finance Ordinary 100%
to trade customers 13. STOCKS
The following are included in the net book value of stocks:
2005 2004
£’000 £’000
GROUP
Raw materials and consumables 415 450
Finished goods and goods for resale 2,639 2,264
3,054 2,714
It is the view of the directors that there is no material difference between the net book value of stocks and their replacement cost.
The Company has no stocks at 3 April 2005 or 28 March 2004.
14. DEBTORS
2005 2004
£’000 £’000
GROUP
Amounts falling due within one year:
Trade debtors 6,785 6,049
Other debtors 394 301
Prepayments and accrued income 1,217 1,397
8,396 7,747
The Company has no other debtors at 3 April 2005 (2004: £2,000).
15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
GROUP COMPANY
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Bank overdraft (note 16) 13,088 1,584 – –
Bank loans in respect of trade lending (note 16) 1,831 4,289 – –
Revolving credit facility (note 16) 20,000 – 20,000 –
Bank term loan (note 16) 1,000 1,000 1,000 1,000
Trade creditors 5,053 4,238 – –
Corporation tax 437 1,042 – –
Other taxation and social security 2,699 2,195 118 27
Other creditors 3,152 2,961 – –
Accruals and deferred income 6,894 4,938 2,388 473
Dividends payable 2,388 2,138 – 2,138
Finance lease creditors (note 16) 218 434 – –
56,760 24,819 23,506 3,638
Included in trade creditors are amounts totalling £1,304,000 (2004: £780,000) due in respect of goods for which title does not pass until
payment is made.
NOTES TO THE ACCOUNTS
48 The Belhaven Group plc Annual Report and Accounts 2005 49
NOTES TO THE ACCOUNTS
16. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
GROUP COMPANY
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Term loan 18,000 19,000 18,000 19,000
Revolving credit facility – 15,000 – 15,000
Bank loans in respect of trade lending 13,198 9,190 – –
Finance lease creditors – 212 – –
31,198 43,402 18,000 34,000
Total borrowings are repayable as follows:
– within one year 36,137 7,307 21,000 1,000
– within one to two years 3,065 17,543 1,250 16,000
– within two to five years 9,773 7,320 4,750 3,750
– after more than five years 18,360 18,539 12,000 14,250
67,335 50,709 39,000 35,000
FINANCIAL INSTRUMENTS
The disclosures in respect of certain financial assets and liabilities such as investments in subsidiaries, short term debtors and creditors have 
been excluded as permitted by FRS 13.
TREASURY MANAGEMENT
The main financial risk faced by the Group from its treasury activity is interest rate risk. The Board has reviewed and agreed the policy for
managing the risk. The Group’s treasury objective is to obtain its borrowings at the lowest possible cost and within covenants that are not 
over-stretching. Any decisions on hedging are considered throughout the year and are based on an estimation of future interest rate trends.
INTEREST RATE PROFILE
At 3 April 2005, the Group’s financial assets consisted of trade loans and advance discounts (note 12) which bear fixed rates of interest at
between 0% and 8%, and cash at bank and in hand.
After taking into account interest rate swaps entered into by the Group, the interest rate profile of the Group’s financial liabilities at 
3 April 2005 is as follows:
Total Floating rate Fixed rate 
£’000 £’000 £’000
Borrowings 67,33547,11720,218
The profile at 28 March 2004 for comparison purposes was as follows:
Total Floating rate Fixed rate
£’000 £’000 £’000
Borrowings 50,70925,06325,646
The floating rate financial liabilities comprise part of the revolving credit facility, bank overdraft and bank loans in respect of trade lending that
bear interest based on LIBOR or Base rate plus an agreed margin.
The weighted average interest rate of the fixed rate financial liabilities is 5.48% (2004 5.67%). The weighted average number of years for which
interest rates are fixed is 1.2 (2004: 1.3).
FAIR VALUES OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES
The book values and fair values of the Group’s financial assets and liabilities at 3 April 2005 and 28 March 2004 are the same other than in
respect of the interest rate swaps. NOTES TO THE ACCOUNTS
50 The Belhaven Group plc
16. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR (CONTINUED)
At 3 April 2005 the interest rate swaps have a carrying value of £nil (2004: £nil) and a positive fair value of £107,000 (2004: negative fair value 
of £8,000).
The fair values of the interest rate swaps have been determined by reference to prices available from the markets on which the instruments
involved are traded.
There are no unrecognised gains or losses on the swaps at 3 April 2005.
The bank loans and revolving credit facility are secured by a floating charge over the Group’s assets. The term loan of £19,000,000 is repayable
in instalments between 2005 and 2010. The revolving credit facility of £20,000,000 is repayable in one instalment in 2005.
The bank loans in respect of trade lending made by Belhaven Finance Limited are secured by a floating charge over the assets of that company
and are repayable in instalments over a 10 year period.
The Group has made loans and other advances to trade customers of £24,101,000 (2004: £21,635,000) of which £15,029,000 (2004: £13,479,000)
has been funded by the bank loans in respect of trade lending.
The Group has undrawn committed borrowing facilities at 3 April of £6,912,000 (2004: £23,416,000). These undrawn committed facilities relate
to the bank overdraft.
OBLIGATIONS UNDER FINANCE LEASES:
2005 2004
£’000 £’000
GROUP
Amounts payable:
– within one year 218 434
– within one to two years – 212
218 646
The Company has no obligations under finance leases as at 3 April 2005 or 28 March 2004.
17. PROVISIONS FOR LIABILITIES AND CHARGES
Provisions for liabilities and charges comprise:
Deferred Maclay Other
tax consideration provisions Total
£’000 £’000 £’000 £’000
GROUP
Beginning of year 6,839 214 152 7,205
Charge to profit and loss account 1,600 – – 1,600
Prior year adjustment (662) – – (662)
Maclay consideration payable within 1 year – (201) – (201)
Long term incentive plan – – (99) (99)
End of year 7,777 13 53 7,843
The deferred tax provision comprises capital allowances in excess of depreciation and other timing differences of £7,777,000 (2004: £6,839,000).
Provision for any tax on capital gains which might become payable on the disposal of revalued properties is made only when it is decided in
principle to dispose of the asset. There would have been no material tax liability in either year if all properties had been sold at their book 
values at the year ends after making an allowance for the effect of indexation and other reliefs.
During the year to 31 March 2002 the Group purchased 15 public houses and certain other assets from Maclay Group plc and Maclay Wholesalers
Limited. As part of the sale and purchase agreement, the Group pays to Maclay a share of the profit earned on the business transferred based 
on volume over a five year period ending 2 April 2006. £201,000 of the consideration, based on the actual volumes for the year ended 
3 April 2005 of the business transferred, is payable to Maclay in June 2005 and is included in creditors falling due within one year.
The Group has provided for payments which may be made under its Long Term Incentive Plan (“LTIP”) over performance periods. Payments
under the LTIP are dependent on the Group meeting the performance criteria for each award.
In accordance with UITF Abstract 25 “National Insurance contributions on share options gains”, the Group provides for National Insurance
contributions on outstanding unapproved share options that are expected to be exercised.
The Company has no provisions for liabilities and charges as at 3 April 2005 or 28 March 2004. Annual Report and Accounts 2005 51
NOTES TO THE ACCOUNTS
18. CALLED-UP EQUITY SHARE CAPITAL
2005 2004
Issued and Issued and
Authorised fully paid Authorised fully paid
£’000 £’000 £’000 £’000
EQUITY SHARES
45,000,000 authorised and 29,850,098 issued 
and fully paid ordinary shares of 10p each 4,500 2,985 4,500 2,949
During the year the Company issued 364,644 ordinary shares with a nominal value of 10p each to employees in respect of share options
exercised:
Number of shares Share capital Share premium
£’000 £’000
Employee share options exercised 364,644 36 637
At 3 April 2005, the Company had outstanding options in respect of the following:
Subscription
Number of ordinary price
shares subject to option Period of option per share
TYPE
Belhaven Approved 
Executive Share Option Scheme 11,349 16 July 1999 to 15 July 2006 198.0p
Belhaven Approved 
Executive Share Option Scheme 6,309 16 July 2002 to 15 July 2009 226.0p
Belhaven Approved 
Executive Share Option Scheme 15,892 17 July 2003 to 16 July 2010 194.5p
Belhaven Approved 
Executive Share Option Scheme 63,976 12 July 2005 to 11 July 2012 316.5p
Belhaven Unapproved 
Executive Share Option Scheme 10,522 12 July 2005 to 11 July 2009 316.5p
Belhaven Approved 
Savings Related Share Option Scheme (3 years) 91,567 1 October 2005 to 31 March 2006 258.0p
Belhaven Approved 
Savings Related Share Option Scheme (5 years) 76,269 1 October 2007 to 31 March 2008 258.0p
Under the terms of the Belhaven Approved Executive Share Option Scheme (“Approved Scheme”), the Belhaven Unapproved Executive Share
Option Scheme (“Unapproved Scheme”) and the Belhaven Approved Savings-Related Share Option Scheme (“SAYE Scheme”) shares may be
acquired on the exercise of options. These schemes were established on 3 July 1996. Inland Revenue approval was granted in respect of the
Approved and SAYE schemes on 10 July 1996, and an issue of options under both the Approved and Unapproved Schemes was made to eligible
employees on 16 July 1996. Further issues of options under the Approved Scheme were made to eligible employees on 16 and 26 July 1999,
17 July 2000, 15 January 2001 and 12 July 2002. Further issues of options under the Unapproved scheme were made to eligible employees on 
17 July 2000, 15 January 2001 and 12 July 2002. Issues of options under the SAYE scheme were made to eligible employees in July 1996,
August 1999 and August 2002. All interests are beneficial interests. NOTES TO THE ACCOUNTS
52 The Belhaven Group plc
19. RESERVES
Share Revaluation Profit and
premium reserve loss account
£’000 £’000 £’000
GROUP
Beginning of year 45,721 4,720 27,021
Retained profit for the financial year – – 9,278
Funds set aside for new shares to be issued under LTIP scheme – – 91
Disposal of pubs – 91 (91)
Amortisation of revaluation surplus – (19) 19
Surplus on revaluation – 4,427 –
Premium on exercise of share options 637 – –
End of year 46,358 9,219 36,318
The cumulative amount of goodwill written off against the Group’s reserves under the transitional arrangement provisions included in FRS 10 is
£2,719,000 (2004: £2,719,000).
Share Profit and
premium loss account
£’000 £’000
COMPANY
Beginning of year 45,721 2,220
Retained profit for the financial year – 1,117
Premium on exercise of share options 637 –
End of year 46,358 3,337
As permitted by Section 230 of the Companies Act 1985, the Company’s profit and loss account has not been included in the accounts.
The Company’s profit after taxation was £4,814,000 (2004: £3,722,000).
20. RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS’ FUNDS
GROUP COMPANY
53 weeks ended 52 weeks ended 53 weeks ended 52 weeks ended
3 April 2005 28 March 2004 3 April 2005 28 March 2004
£’000 £’000 £’000 £’000
Profit for the financial year 12,975 10,104 4,814 3,722
Dividends paid and proposed (3,697) (3,300) (3,697) (3,300)
Surplus on revaluation 4,427––
Called up share capital 36 763 36 763
Share premium account 637 24,320 637 24,320
Funds set aside for new shares to be 
issued under LTIP scheme 91 70 – –
Opening equity shareholders’ funds 80,411 48,454 50,890 25,385
Closing equity shareholders’ funds 94,880 80,411 52,680 50,890 Annual Report and Accounts 2005 53
NOTES TO THE ACCOUNTS
21. ANALYSIS OF CASH FLOWS
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
RECONCILIATION OF OPERATING PROFIT TO OPERATING CASH FLOWS
Operating profit 20,459 16,604
Amortisation of goodwill 102 100
Depreciation 2,623 2,313
Gain on sale of tangible fixed assets (162) (8)
(Increase) in stocks (340) (471)
(Increase) in debtors (649) (527)
Increase in creditors 3,257 2,811
Net cash inflow from operating activities 25,290 20,822
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received 656 297
Interest paid (3,658) (2,623)
Interest element of finance lease rentals (29) (47)
Net cash outflow (3,031) (2,373)
TAXATION
UK corporation tax paid (4,120) (2,488)
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Trade loans advanced (17,408) (14,093)
Trade loans repaid 14,942 8,735
Purchase of tangible fixed assets (30,491) (29,641)
Sale of tangible fixed assets 991 825
Net cash outflow (31,966) (34,174)
FINANCING
Banks and other loans (repaid)/raised 5,550 (32)
Finance leases repaid (428) (481)
Increase in share capital 673 25,083
Net cash inflow 5,795 24,570 NOTES TO THE ACCOUNTS
54 The Belhaven Group plc
22. ANALYSIS OF CHANGES IN CASH DURING YEAR
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Beginning of year (1,379) (5,039)
Net cash inflow/(outflow) (11,479) 3,660
End of year (12,858) (1,379)
Cash at the end of the year comprises:
Cash at bank and in hand 230 205
Bank overdraft (13,088) (1,584)
(12,858) (1,379)
23. ANALYSIS AND RECONCILIATION OF NET DEBT
28 March 3 April
2004 Cash flow 2005
£’000 £’000 £’000
The movement in the year was as follows:
Cash at bank and in hand 205 25 230
Bank overdraft (1,584) (11,504) (13,088)
(1,379) (11,479) (12,858)
Debt due within one year (5,289) (17,542) (22,831)
Debt due after more than one year (43,190) 11,992 (31,198)
Finance leases (646) 428 (218)
(49,125) (5,122) (54,247)
Net debt (50,504) (16,601) (67,105)
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
Increase/(decrease) in cash in the year (11,479) 3,660
Cash (inflow)/outflow from changes in debt and lease financing (5,122) 513
Movement in net debt in year (16,601) 4,173
Net debt at beginning of year (50,504) (54,677)
Net debt at end of year (67,105) (50,504)
24. GUARANTEES
The Group has guaranteed bank loans to trade customers to the extent of £6,646,000 (2004: £8,002,000). The Group’s obligations are mainly
secured by way of second charges on properties owned by the trade customers, postponed in ranking to the charges granted to the principal
lenders. Annual Report and Accounts 2005 55
NOTES TO THE ACCOUNTS
25. COMMITMENTS AND CONTINGENCIES
(a) CAPITAL COMMITMENTS
Group capital commitments are as follows:
2005 2004
£’000 £’000
Contracted for but not provided 1,614 7,030
The Company had no capital commitments at 3 April 2005 or 28 March 2004.
(b) LEASE COMMITMENTS
Annual commitments under non-cancellable operating leases are as follows:
2005 2004
Plant & Motor Land & Plant & Motor Land &
machinery vehicles buildings machinery vehicles buildings
GROUP £’000 £’000 £’000 £’000 £’000 £’000
Expiry date:
– within one year 14 104 – 25 143 76
– between two and five years 28 594 – 39 433 –
– after more than five years –– 448 –– 318
42 698 448 64 576 394
The Company had no commitments under non-cancellable operating leases at 3 April 2005 or 28 March 2004.
26. PENSION SCHEME
The Group operates a defined benefit pension scheme in the UK, the Belhaven Brewery Company Limited 1977 Pension Scheme.
The Group has been committed to making payments to this pension scheme at the rate of 12.07% of pensionable earnings of scheme members
since 1 November 2002.
The contributions payable are reflected in the profit and loss account. The assets of the pension scheme are held separately from those of the
Group and are invested under the supervision of the scheme Trustees. The scheme is at present funded and an independent actuary assesses the
pension cost and provision/asset position.
A full actuarial valuation of the scheme was carried out as at 1 November 2002 by the scheme actuary. A market based valuation was used
with the assets taken at market value and the liabilities valued using the projected unit method. Under the projected unit method the past
service liability is calculated by estimating the future benefit payments from the scheme based on pensionable service up to the valuation date
and final pensionable salaries projected to retirement or assumed date of leaving.
The most significant assumptions used to calculate the value of benefits are:
1. Salaries increase at the rate of 4.25% per annum compound including an allowance for promotional and merit increases.
2. A yield of 6.5% per annum up to retirement and 5.5% per annum after retirement.
Based on these assumptions the past service liability at 1 November 2002 was £6,030,000. The market value of the assets was £4,405,000
resulting in a deficit of £1,625,000 and a funding level of 73%. The scheme actuary has recommended that the deficit be eliminated over 
10 years. This, together with the cost of life insurance and death in service benefits, has been taken into account in determining the employer
contribution rate.
The employer and employee combined rate is 17.57% of pensionable salaries for employees and executive directors (2004: 17.57%).
Employees contribute at the rate of 5.5% (2004: 5.5%).
The SSAP 24 charge in respect of the defined benefit scheme for 2005 was £538,125 (2004: £481,582).
The Group also contributes in respect of the executive directors and senior managers a sum equal to 7.7% of the gross salary excluding bonus, by
equal monthly contributions into Money Purchase Individual Executive Plans administered by an insurance company. NOTES TO THE ACCOUNTS
56 The Belhaven Group plc
26. PENSION SCHEME (CONTINUED)
FRS 17 TRANSITIONAL DISCLOSURES
Additional disclosures regarding the Group’s defined benefit pension scheme are required under the transitional provisions of FRS 17
“Retirement Benefits” and these are set out below. The disclosures relate to the third year of the transitional provisions.
The pension cost figures used in these accounts comply with the current pension cost accounting standard SSAP24. Under current transitional
arrangements for a new pension cost accounting standard, FRS17, the Group is required to disclose information about the Scheme and the
figures that would have been shown under FRS17 in the current balance sheet. The two different bases are determined using different actuarial
valuations carried out at different dates and the figures currently used for accounting purposes as regards pension costs may change
significantly when FRS17 is implemented in full. As required by SSAP24, the figures included in the accounts in respect of the Group pension
scheme are based on an actuarial valuation carried out at 1 November 2002. This does not take into account any impact of movements in
general stock market values since that date.
The last full actuarial valuation of the scheme, as described above, has been updated to 3 April 2005 for FRS 17 transitional disclosure purposes
by a qualified independent actuary.
The major assumptions used by the actuary were (in nominal terms):
Valuation Valuation  Valuation 
as at as at as at
3 April 28 March 30 March
2005 2004 2003
Pensionable salary growth 4.25% 4.25% 3.75%
Pension escalation in payment – pre 6 April 1997 benefits 2.50% 2.50% 2.50%
– increase to post 6 April 1997 benefits 2.75% 2.75% 2.50%
Discount rate 5.35% 5.50% 5.40%
Inflation assumption 2.75% 2.75% 2.25%
The assets in the scheme and the expected long term rate of return were:
Long-term  Long-term Long-term
rate of return Value at rate of return Value at rate of return Value at
expected at 3 April expected at 28 March expected at 30 March
3 April 2005 2005 28 March 2004 2004 30 March 2003 2003
£’000 £’000 £’000
Equities 7.60% 6,327 8.00% 5,216 8.00% 3,226
Bonds 5.00% 625 5.00% 707 5.00% 666
Property 7.00% 102 7.00% 76 7.00% 53
Cash 4.75% 955 4.00% 382 4.00% 325
Total market value of assets 8,009 6,381 4,270
Present value of scheme liabilities (12,005) (9,860) (7,295)
Deficit in the scheme (3,996) (3,479) (3,025)
Related deferred tax asset 1,199 1,044 908
Net pension liability (2,797) (2,435) (2,117)
If the Group had to reflect the net pension liability through its reserves at 3 April 2005 then the net profit and loss amount reserve figure would
have been stated as shown below.
53 weeks 52 weeks 52 weeks 
ended ended ended
3 April 28 March 30 March
2005 2004 2003
Profit and loss account excluding pension liability 36,318 27,021 20,598
Net pension liability (2,797) (2,435) (2,117)
Profit and loss account 33,521 24,586 18,481
On the advice of the Group’s actuary, there is no requirement for the Group to increase funding further to the increase from 1 November 2002
described above. The level of contributions will be reviewed by the actuary following completion of the next triennial valuation which is being
undertaken as of 31 March 2005. Annual Report and Accounts 2005 57
NOTES TO THE ACCOUNTS
26. PENSION SCHEME (CONTINUED)
53 weeks ended 52 weeks ended
3 April 2005 28 March 2004
£’000 £’000
ANALYSIS OF THE AMOUNT THAT WOULD HAVE BEEN CHARGED 
TO OPERATING PROFIT UNDER FRS 17
Current service cost (599) (583)
Total operating charge (599) (583)
ANALYSIS OF THE AMOUNT THAT WOULD HAVE BEEN (CHARGED)/CREDITED 
TO NET FINANCE CHARGES UNDER FRS 17
Expected return on pension scheme assets 516 345
Interest on pension scheme liabilities (569) (414)
Net cost (53) (69)
ANALYSIS OF THE ACTUARIAL LOSS THAT WOULD HAVE BEEN INCLUDED IN THE 
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES UNDER FRS 17
Actual return less expected return on pension assets (75) 736
Experience gains and losses arising on the scheme liabilities (98) (26)
Changes in assumptions underlying the present value of the scheme liabilities (568) (1,362)
Actuarial loss recognised (741) (652)
MOVEMENT IN SCHEME DEFICIT DURING THE YEAR
Deficit in scheme at beginning of year (3,479) (3,025)
Current service cost (599) (583)
Contributions paid by employer 876 850
Net finance income (53) (69)
Actuarial loss (741) (652)
Deficit in scheme at end of year (3,996) (3,479)
HISTORY OF EXPERIENCE GAINS AND LOSSES
53 weeks 52 weeks 52 weeks 
ended ended ended
3 April 28 March 30 March
2005 2004 2003
Difference between the expected and actual return on scheme assets:
Amount (£’000) (75) 736 (1,600)
Percentage of scheme assets 1% 12% 37%
Experience gains and losses on scheme liabilities
Amount (£’000) (98) (26) (59)
Percentage of the present value of scheme liabilities 1% 0% 1%
Total actuarial loss in the statement of total recognised gains and losses
Amount (£’000) (741) (652) (2,324)
Percentage of the present value of scheme liabilities 6% 7% 32% NOTICE OF ANNUAL GENERAL MEETING OF THE BELHAVEN GROUP PLC
58 The Belhaven Group plc
Notice is hereby given that the Annual General Meeting of The Belhaven Group plc (the “Company”) will be held at Braid Hills Hotel, 134 Braid Road,
Edinburgh EH10 6JD on 15 July 2005 at 10.00 a.m. for the purpose of transacting the following business.
ORDINARY BUSINESS
(1) To receive the reports of the directors and auditors and to adopt the accounts of the Company for the year ended 3 April 2005.
(2) To receive and approve the directors’ remuneration report for the year ended 3 April 2005.
(3) To declare a final dividend of 8.00p per ordinary share.
(4) To elect Ron Robson as a director.
(5) To re-elect Graeme Bissett as a director.
(6) To re-appoint Deloitte & Touche LLP as auditors of the Company and to authorise the directors to fix their remuneration.
SPECIAL BUSINESS
(7) To consider and, if thought fit, pass the following resolution as a Special Resolution of the Company.
“THAT in substitution for any existing power under section 95 of the Companies Act 1985 (as amended and from time to time in force) (the “Act”), but
without prejudice to the exercise of any such power prior to the date hereof, the directors of the Company be and are hereby empowered pursuant to
section 95 of the Act to allot equity securities (within the meaning of section 94(2) to section 94(3A) of the Act) for cash pursuant to the authority
existing as at the date of this resolution given in accordance with section 80 of the Act as if section 89(1) of the Act did not apply to any such allotment
provided that this power shall expire on 14 October 2006, and shall be limited to:
(a) the allotment of equity securities in connection with a pro rata offer or issue of securities to or in favour of the holders of ordinary shares of the
Company 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 all the holders of ordinary shares are proportionate (as nearly as practicable) to the respective numbers of ordinary shares of the
Company held or deemed to be held by them on such record date(s) provided that the directors may make such exclusions or arrangements in
respect of overseas holders of shares and in respect of fractional entitlements and legal or practical problems arising in connection with the laws or
requirements of any regulatory body or stock exchange in any territory as they may consider necessary or convenient; and
(b) the allotment (otherwise than pursuant to paragraph (a) above) to any person or persons of equity securities up to an aggregate nominal value of
£149,250.
save that the Company may before such expiry make an offer or agreement which would or might require equity securities to be allotted after such
expiry and the directors may allot equity securities in pursuance of such offer or agreement as if the power conferred hereby had not expired.
This power applies in relation to a sale of shares which is an allotment of equity securities by virtue of section 94(3A) of the Act as if in the first
paragraph of this resolution the words “pursuant to the authority existing as at the date of this resolution given in accordance with section 80 of the Act”
were omitted.”
By order of the Board
Ron Robson
Secretary
Registered Office: Belhaven Brewery, Brewery Lane, Dunbar, East Lothian EH42 1PE
6 June 2005 Annual Report and Accounts 2005 59
NOTICE OF ANNUAL GENERAL MEETING OF THE BELHAVEN GROUP PLC
NOTES
1. Proxies
A member of the Company entitled to attend and vote at the Meeting convened by the foregoing Notice may appoint one or more proxies (who need not be
a member) to attend and, on a poll, vote in his place. The instrument appointing a proxy and the power of attorney or other authority (if any) under which it
is signed or a notarially certified copy of that power of attorney or other authority must be delivered at the office of the Company’s registrars, Capita
Registrars (Proxies), PO Box 25, Beckenham, Kent BR3 4BR, not later that 48 hours before the time appointed for holding the Meeting.Return of a completed
form of proxy will not preclude a member from attending and voting personally at the Meeting or at any adjournment thereof.
2. Other Documents
Copies of all service contracts of the directors with the Company or any of its subsidiaries and the register of interests of directors (and their families) in the
share capital of the Company will be available for inspection at the Registered Office of the Company at Belhaven Brewery, Brewery Lane, Dunbar,
East Lothian EH42 1PE during normal business hours on any weekday (Saturdays and public holidays excluded) from the date of this Notice up to and
including the date of the Annual General Meeting and at Braid Hills Hotel on 15 July 2005 from 9.30 a.m. until the conclusion of the Annual General Meeting.
3. Entitlement to attend and vote
Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, the Company specifies that only those holders of ordinary shares entered on
the register of members of the Company at 10.00 a.m. on 13 July 2005 or, in the event that the Meeting is adjourned, on the register of members 48 hours
before the time of the adjourned meeting, shall be entitled to attend or vote at the Meeting in respect of the number of ordinary shares registered in their
name at that time. Changes to the entries on the register of members after 10.00 a.m. on 13 July 2005 or, in the event that the Meeting is adjourned, in the
register of members 48 hours before the time of any adjourned meeting, shall be disregarded in determining the rights of any person to attend or vote at the
Meeting notwithstanding any provisions in any enactment, the articles of association of the Company or other instrument to the contrary. ADVISORS AND SHAREHOLDER INFORMATION
60 The Belhaven Group plc
Stockbrokers Collins Stewart
88 Wood Street, London EC2V 7QR
Solicitors Dickson Minto
on corporate matters 16 Charlotte Square, Edinburgh EH2 4DF
Solicitors Boyle Shaughnessy
on property matters Standard Buildings
and trade lending 94 Hope Street, Glasgow G2 6QB
Auditors Deloitte & Touche LLP
Saltire Court, 20 Castle Terrace, Edinburgh EH1 2DB
Bankers Bank of Scotland
New Uberior House, 11 Earl Grey Street, Edinburgh EH3 9BN
PR Advisors Binns & Co PR Ltd
1 Ropemaker Street, London EC2Y 9HT
Registrars Capita Registrars
The Registry, 34 Beckenham Road, Kent BR3 4TU
Registered office Belhaven Brewery
Dunbar, East Lothian EH42 1PE
Registered number SC 146920
Web site address www.belhaven.co.uk
E-mail address info@belhaven.co.uk “Here’s to the next 100 million pints!” THE BELHAVEN GROUP plc  Annual Report and Accounts 2005
The Belhaven Group plc
Dunbar
East Lothian
EH42 1PE
Telephone 01368 862734
info@belhaven.co.uk
www.belhaven.co.uk