Naturex Expecting Strong Improvement in Margins in 2008

02/04/08 Naturex have said in a statement that as expected, 2007 was a year of consolidation for Naturex during which the Group integrated the strategic acquisitions made in Italy at the start of the year, namely Hammer Pharma and HP Botanicals. In repurchasing these companies, Naturex now ranks amongst the leading companies on Italy's buoyant neutraceuticals market and has acquired a high quality industrial site close to Milan as well as gaining access to a new market, the pharmaceuticals industry.

Naturex has posted revenues of EUR 79.5 million in 2007, representing growth of 27.4% in constant dollars and 20.1% in current dollars. Following the integration of Hammer Pharma and HP Botanicals over 12 months in 2006 and 2007, the Group's organic growth came out at 12.1% in constant dollars and 5.8% in current dollars.

Its operating margin, largely impacted by the dilutive effect of the acquisition of Hammer Pharma, the ongoing reinforcement of the Group's teams and the sharp downturn in the dollar during the second half of the year, stood at 8.4%.

Group net income amounted to EUR 4.4 million, i.e. 5.5% of revenues.

Naturex's proforma revenues in 2007 totaled EUR 85.6 million, added to which are the EUR 3.8 million generated by the "actifs innovants" (innovative active ingredients) division of Berkem acquired in January.

Over the course of 2008, the Group intends to pursue its dynamic growth in constant dollars, notably through its expansion overseas. Indeed, not only will Naturex benefit from the strong development of its new commercial offices, but the Group is also setting up a subsidiary in China and plans to open new offices in Germany in the first half of the year and in Japan during the second half.

Naturex will also focus on the development of its innovative active ingredients business, an activity with a strong growth potential and value-added in which it has recently upped its investment.

The Group targets an operating margin of 11% in 2008 thanks to:
• the integration of Chart Corporation and the innovative active ingredients business of Berkem, two highly profitable acquisitions,
• the first concrete benefits of its policy to improve costs and margins implemented in 2007.

Finally, Naturex Group intends to reduce its inventories from 50 to 40% of revenues over 3 years.

Naturex will publish its revenues for the first quarter of 2008 on April 30, 2008.