HIGHLIGHTS FOR FIRST QUARTER 2009
• Group gross margin improved substantially to 32.5% from 30.0%
• EBITDA margin improved significantly to 14.1% from 12.4%
• On a constant currency basis (in rubles) Adjusted net income grew 25.1%
• On a constant currency basis (in rubles) EBITDA increased 12.7%
• Operating cash flow rose 136.4% to US$102.6 million
• Group revenue decreased 29.4% year-on-year to US$516.8 million driven by unprecedented ruble devaluation offset by favorable mix
• Russian ruble devalued almost 45% year-on-year against US dollar in the first quarter
• Operating profit margin increased 110 basis points to 9.8%
“The first quarter laid a solid foundation for the year, particularly in terms of substantial margin improvement and a balance sheet that is healthier than ever,” said Tony Maher, Wimm-Bill-Dann’s Chief Executive Officer. “The company continues to perform very well in all business segments despite the challenges in the economic environment.”
“We are working to maximize the return from our marketing and advertising investments, with a focus on gaining share in higher margin categories. As of the end of the first quarter, our market share in juices increased 170 basis points in volume terms compared to the end of the first quarter 2008. Our market share in baby food improved 240 basis points in volume terms over the same period, while our market share in yogurts and desserts increased 140 basis points in volume terms over the same period of time.”
“Our gross margin for the first quarter of 2009 expanded to 32.5%, up 250 basis points on a year-on-year basis. EBITDA margin also improved in the quarter to 14.1%, up 170 basis points versus the prior year period.”
“We substantially enhanced our capital structure to ensure that we are operating from a position of financial strength in the near-term and have the flexibility to pursue growth initiatives over the long-term. Last quarter, we paid down our bond using internal funds and this quarter we reissued some of those bonds on more favourable terms. This secondary issue of 3 billion rubles was sold at the lowest yield to market of any major Russian issuance this year, a significant accomplishment for Wimm-Bill-Dann and a testament to the strength of our business. Our continued efforts to improve our working capital efficiency led to us generating over $85 million in free cash flow, which, among other things, allowed us to repurchase 3.6% of our outstanding share capital in the open market in the form of ordinary shares.”
“Looking ahead we understand that the current environment will continue to pose its challenges and we are working to manage the business through the near-term hurdles while improving our competitive position and our ability to execute on long-term opportunities. The soundness of our strategy and the strength of our balance sheet will help us navigate the issues of today and position the company optimally for sustainable growth as the economic environment improves.”
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