Ardagh Glass Finance plc - Irish Stock Exchange

Operating Results
The significant increases in revenue, gross profit, sales, general and administration expenses and
operating profit are largely due to the Rexam Acquisition which was completed in June 2007. We have
eliminated some of the effects of the acquisition to provide like-for-like comparisons for Ardagh’s
operations.
Revenue
Group revenue increased by A377.5 million, or 58.3%, to A 1,025.0 million in the year ended
December 31, 2007 from A 647.5 million in the year ended December 31, 2006. This increase is
primarily due to the Rexam Acquisition. Excluding this acquisition, revenue increased by A10.5 million,
or 1.6%, to A658.0 from A647.5 million in the year ended December 31, 2006.
Gross Profit
Gross profit, excluding one time costs, increased by A110.0 million to A137.4 million in the year
ended December 31, 2007 from A27.4 million in the year ended December 31, 2006 primarily due to
the Rexam Acquisition. Gross profit as a percentage of revenue increased from 4.2% to 13.4% as a
result of improved product mix, efficiency gains and cost reductions resulting from this acquisition.
SG&A Expenses
Group SG&A expenses for 2007 were A57.6 million compared to A32.9 million in 2006, an increase
of A24.7 million or 75.1% primarily due to the Rexam Acquisition. SG&A as a percentage of revenue
increased from 5.1% to 5.6%, before the full integration of Rexam had been effected.
Other Income and Expenses
Net expense amounting to A8.9 million has been treated as ‘one time’ in 2007. This amount is
made up of the following elements:
• Ardagh incurred severance costs of A8.9 million due to a headcount reduction program as a
result of the Rexam glass division integration process.
Net income amounting to A8.8 million has been treated as ‘one time’ in 2006. This amount is made
up of the following elements:
• On January 1, 2006 one third of the United Kingdom pension deficit was derecognized because
from that date the scheme became funded on a shared cost basis whereby the scheme members
fund one third of the cost of providing the benefits and the company funds two thirds of the
cost. This has been treated as a realized gain reflecting reduced future cashflows associated with
the scheme and as a result a credit of A19.3 million has been recognized on the Other Income
and Expense line in the income statement;
• The United Kingdom incurred A0.5 million in non trade related legal costs;
• The Fixed Asset write downs of A1.9 million relating to the November 2006 furnace closure at
the Barnsley plant;
• The United Kingdom incurred severance costs of A7.2 million due to a headcount reduction
programme as a result of the Redfearn integration process and the November 2006 furnace
closure at the Barnsley site; and
• Ardagh recognized two goodwill adjustments amounting to A 0.9 million in 2006. A0.2 million
relating to the acquisition of the remaining minority interests in HSU and A 0.7 million due to
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