WIMM-BILL-DANN FOODS OJSC ANNOUNCES SIGNIFICANTLY IMPROVED MARGINS AND CONTINUED IMPROVEMENT IN FREE CASH FLOW IN SECOND QUARTER OF 2009

Highlights for the second quarter and first half of 2009

• Group gross margin improved by 220 basis points to 35.2% in the second quarter of 2009 compared to the second quarter of 2008, and by 240 basis points year-on-year to 33.9% in the first half of 2009
• EBITDA  margin improved significantly by 320 basis points to 15.4% in the second quarter of 2009 compared to the second quarter of 2008, and by 250 basis points year-on-year to 14.8% in the first half of 2009
• Operating profit margin increased substantially to 11.1% in the second quarter of 2009 from 8.2% a year ago, and to 10.4% in the first half of 2009 from 8.4% in the first half of 2008
• Group revenue in US dollars decreased 28.2% year-on-year to US$1,071.5 million in the first half of 2009, driven by ruble devaluation, and partially offset by stronger mix
• Net income in US dollars increased 42.6% year-on-year to US$52.3 million in the second quarter of 2009
• On a constant currency basis, (in rubles) net income almost doubled in the second quarter of 2009 compared to the second quarter of 2008, and increased by 12.3% year-on-year in the first half of 2009
• Operating cash flow rose 64.0% year-on-year to US$180.3 million in the first half of 2009

“The second quarter of 2009 demonstrated our ability to adapt quickly to changing market conditions, the resilience of our brands and our business model. It also proved that profitable growth can be achieved despite somewhat weakened consumer demand,” said Tony Maher, Wimm-Bill-Dann’s Chief Executive Officer.
“We are very pleased with our results. We have delivered substantial margin improvement on the EBITDA and gross margin levels. In the second quarter of 2009, group gross margin improved 220 basis points year-on-year to 35.2%. It also improved for each of the business segments, reaching 31.4% in dairy, 40.4% in beverages and 48.8% in baby food. Our EBITDA margin stood at 15.4% in the second quarter of 2009, reflecting both enhanced efficiency and seasonally lower input costs. Our net profit in the second quarter grew 42.6%.”
“Our operating cash flow continued to show significant improvement, while our net debt decreased 49.0% year-on-year and stood at US$280.8 million, the lowest level for many years,” Tony Maher added.

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