Pre-tax profits of £27.3 million in the first nine months 2005

REYKJAVIK, 17 November 2005. Bakkavör Group (ICEX: BAKK) reported pre-tax profits of £27.3 million in the first nine months of 2005. Shareholders’ earnings amounted to £20.7 million and net sales of £469.9 million for the first nine months of 2005. EBITDA increased by 202%, amounting to £57.7 million. Cash generated from operations totalled £43.3 million and free cash generated by operating activities was £17.8 million. Earnings per share increased by 134% from 0.5 pence to 1.3 pence. Return on equity was 28.3% compared with 14.9% in the same period last year.

Key operating results for the first nine months 2005

·       Shareholders’ earnings £20.7 million – up by 137%

·       Operating profit (EBIT) £45.8 million – up by 181%

·       Net sales £469.9 million – up by 341%

·       Growth in underlying business 7.5%

·       EBITDA £57.7 million – up by 202%

·       EBITDA ratio 12.3%

·       Cash generated from operations £43.3 million – up by 202%

·       Free cash generated by operating activities £17.8 million – up by 115%

·       Total assets £1,031.7 million – up by 279%

·       Equity ratio 11.9% – down from 37.1%

·       Earnings per share increased from 0.5p to 1.3p – up by 134%

·       Return on equity 28.3% compared with 14.9% in the first nine months of 2004

CEO’s comments on the results

Lýdur Gudmundsson, CEO:

“The nine months results clearly demonstrate Bakkavör Group’s continuing success following the acquisition of Geest, which has now been part of the Group for five months. The integration of the Geest businesses is running to schedule. The acquisition of Hitchen Foods in October is in line with our strategy and strengthens our position in a growing sector of the fresh prepared foods market. Further consolidation in the UK market can be expected and we intend to play an active role in that development, continuing to target growth sectors and remaining at the forefront of the fresh prepared foods market.”