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Ter Beke Turnover Up but Earnings Down

03 September 2012

BELGIUM - Belgian meat and food processor, Ter Beke saw its consolidated turnover increase in the first half of 2012 by €9.7 million - 4.9 per cent - to €208.2 million.

EBITDA from recurring operating activities came to €15.8 million in 2012 compared to €16.4 million in 2011 down by 3.2 per cent, primarily becaaue of a €1.5 million increase in commercial efforts.

The first half year contains €1.3 million dismissal and reorganisation costs, primarily due to the termination of the industrial activities in Alby-sur-Chéran, France, and €0.3 million reversal of impairments.

Because of this, EBITDA came to to €14.5 million compared to €16.4 million in 2011, a drop of 11.6 per cent and EBIT was to €5.5 million compared to €7.4 million in 2011 a fall of 26.6 per cent.

The result after taxes was to €3.1 million compared to €4.5 million in 2011a fall of 30.9 per cent.

In the Processed Meats Division: there was an increase in turnover at stable volumes and profitability remained under pressure because of a changed product mix, shifting towards cheaper products, and increased raw material prices and the delay in passing these on through the sales prices.

In 2012, the group launched a new range of processed meats under the brand name Oligusto®. It is a meat product enriched with olive oil and a lower total fat content. The launch costs for this were included in the results for the first half year.

The Ready Meals Division saw strong turnover and volume increase in lasagne.

The strong media campaign at the start of 2012 in the Come a casa® brand in Belgium has again resulted in an increasing market share. Come a casa® is increasingly fulfilling its leading position as engine of the fresh Mediterranean meals market.

The increased volumes, the implemented price increases and a far-reaching cost control and reduction were not able to entirely offset increased production costs (chiefly raw materials, energy and wages) and the costs of market investments in the first semester. The changed product mix, with an increase in the sales of cheaper products at the expense of more expensive products caused by the general economic climate, curbed margin growth in the Processed Meats Division.

Industrial activities in Alby-sur-Chéran, France, ended on 30 June 2012. The group does retain its commercial activities in France for products that are produced at the Belgian sites of the Ready Meals Division (Marche-en-Famenne and Wanze).

The costs, amounting to €1.1 million, regarding this termination were charged in full to the results in teh first half year. These costs relate chiefly to personnel costs.

The company said: "In the current economic climate, we are confronted with unexpected additional rises in raw material prices, which prevents us to provide guidance with regard to the earlier announced result forecast."

TheMeatSite News Desk

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