Emmi Continues to Strengthen Market Position 

25/09/07 Emmi successfully defended its excellent market position in Switzerland in the first half of 2007 and continued to strengthen its position abroad. Organic growth was achieved primarily through brand concepts and specialities. By making further targeted investments such as the partnership with Italian cheese specialist Ambrosi S.p.A. and the US-company CASP LLC and the expansion of its own sales organisations, Emmi will reinforce its international position, the company reported.

In the first half of 2007, Emmi posted growth of 10.3% in a challenging market environment. Net sales increased to CHF 1.2 billion (prior year CHF 1.1 billion). Growth in Switzerland is fully attributable to the integration of Mittelland Molkerei into the Emmi Group with effect from 1 April 2006. Brand concepts and specialities, together with the acquisition of northern Italian yoghurt producer Trentinalatte effective 1 July 2006, were roughly equal contributors to the growth abroad of over 25%. Adjusted for acquisitions and consolidation effects, Emmi posted total organic growth of 2.2% in the period under review. Organic growth was achieved primarily through brand concepts such as Emmi Caffè Latte and the Kaltbach line, as well as specialities.

Gross profit was up 12.0% on the first half of 2006 to CHF 374.3 million (prior year CHF 334.1 million), which is primarily attributable to the integration of Mittelland Molkerei and Trentinalatte. The gross profit margin improved to 31.2% (prior year 30.7%) as a result. Operating expenses showed a slightly disproportionate increase of 12.9% to CHF 308.5 million (prior year CHF 273.3 million) due to acquisitions and the company’s international expansion. Earnings before interest, taxes, depreciation and amortisation (EBITDA) were up 11.3% to CHF 68.2 million (prior year CHF 61.2 million), while the EBITDA margin remained flat at 5.7% (prior year 5.6%). Earnings before interest and taxes (EBIT) increased by 14.0% to CHF 32.0 million, with the EBIT margin slightly increased to 2.7% (prior year 2.6%). Net profit for the first half of 2007 rose to CHF 22.7 million (prior year CHF 20.5 million), an increase of 10.6% on the first half of 2006. A net profit margin of 1.9% puts Emmi’s profitability for the first half of 2007 at prior-year level, which means it is well on track.

Meanwhile The Board of Directors has elected Urs Riedener as the new CEO of Emmi Group. Urs Riedener is currently a member of the Migros Executive Board and Head of its Marketing Department. His role at Migros has familiarised him with all aspects of the retail trade including marketing, sales and production. He previously worked for Lindt & Sprüngli, where he successfully expanded brand position both nationally and internationally through top quality products. Urs Riedener (42) studied business administration at the University of St. Gallen.

The Board of Directors is convinced that in electing Urs Riedener, Emmi will be headed by a strong personality with proven leadership experience. He will take over his position at Emmi on 1 April 2008 at the latest. Walter Huber will hand over operational management of the company from the end of September, and will be available for special projects until the end of the year. Until then, the Deputy CEO Robert Muri will manage the day-to-day business of the company.