Investor Relations

Annual Reports

1. Eléments clés du 1^er semestre 2003

• Key figures :
  - gross sales rise by 6.6% to 95.1 million €
  - current net result rises by 16.1% to 2.5 million €
  - profit after taxes rises by 21.8% to 1.9 million €
  - current net cash flow rises by 6% to 7.2 million €
• stable raw material prices and strict cost control result in constant margins
• chilled pasta meals grow further in all European markets
• first results of Come a Casa brand strategy encouraging
• on July 1, 2003 Ter Beke acquires chilled pasta meal producer Di Pasto in France
   

2. Consolidated key figures for 1^st half of the year

2.1 Income statement

2.2 Key figures per share

[*] Current net result and current net cash flow: net result and net cash flow excluding extraordinary results and goodwill amortisations (576,000 EUR in 2003 and 2002)
[**] EBITDA: result from ordinary activities + costs of debts - revenues current assets + amortisations of fixed assets and goodwill
 

3. Notes

3.1 Sales

Sales rise by virtually 7% to 95 million € compared to the same period of 2002. This figure does not include any sales of the Di Pasto activity taken over on July 1, 2003 in France.
This growth has mainly been achieved through the chilled pasta meals, which at present constitute 65% of the volume sold.
In a stagnating processed meats market (Benelux), Ter Beke was able to maintain and even slightly improve its market share.
In the Belgian domestic market, as market leader in chilled pasta meals Ter Beke remains the motor driving further market growth.
Given this solid home base, the greatest growth is being achieved in the international markets.

3.2 Come a Casa brand strategy

As noted earlier, since the autumn of 2002 Ter Beke has been developing the consumer brand Come a Casa for chilled pasta meals, supported by (among other things) a TV campaign in Belgium and Ireland (spring 2003); this investment is continuing in full force.
The initial results are in line with the plan, both with regard to the sales under the Come a Casa brand and to the increased brand familiarity.
In the 2nd half of the year 2003, several new products are being added to the brand´s product range, including pizza, couscous and paella.
 

3.3 Out-of-Home

Since the beginning of 2003, Ter Beke has been developing in the Benelux the (new for the group) market segment of out-of-home consumption. Ter Beke has for this purpose invested in a targeted market approach, supported by a dedicated commercial team.
Although it is still too early to perform an evaluation, here too the initial results are encouraging.
 

3.4 Investments

The new additional lasagna line at the Wanze (Huy) site is fully operational since the beginning of the year. In the autumn of 2003 we begin constructing the new shipping platform in Wanze.
Also, at our Marche-en-Famenne site we start in the autumn 2003 constructing a new R&D Center for chilled pasta meals which will offer support to the production centers in Marche, Wanze and Alby (Di Pasto).
In line with the plan, the further renovation of the complex for salami ripening and drying in Waarschoot is currently in full implementation.
Over the full year of 2003 Ter Beke will complete an investment program of around 12 million €.
 

3.5 Operating results

The 9.3% increase in the operating result is greater than the rise in sales (6.6%), primarily due to the fixed costs which remain under control. The raw material prices are lower than they were last year; the corresponding downward adaptations of the sale prices have no significant effect on the operating result.

3.6 Financial results and cash flow

The financial charges fall by more than 200,000 € as a result of the instalments on the long-term loans and of the positive cash flow. The cash flow over the first half of the year grows by more than 400,000 € compared to last year, which means an improvement of 6%.

3.7 Taxes

The average tax burden increased to 30.9% which amounted last year to 27.4% because the group had in 2002 still tax loss cary forwards. There are no major developments to report on the ongoing dispute with the Belgian tax administration, which dates back from 1996, and about which we reported extensively in the notes to the consolidated financial statements as at December 31, 2002.

3.8 Acquisition in France

On July 1, 2003 Ter Beke took over the producer of chilled pasta meals Di Pasto in Alby-sur-Chéran (Annecy in the Haute-Savoie).
This strategically important takeover was prompted by a desire to develop a more specifically French identity in France, to acquire access to all major French retailers, to spread our production risk internationally and achieve undisputed market leadership in France.
The operational takeover is currently going entirely according to plan, without any surprises.
 

4. Prospects

After the successful year 2002, the results of the 1^st half of 2003 confirm the success of the chosen strategy.
During the second half of the year we expect a slight increase in raw material prices, but without significant effects on the result.
In general we expect to see a continuation of the growth in both volume and results.
Thus we foresee a result that may be over 15% higher than in 2002.

5. Financial services

In accordance with the Belgian Banking and Finance Commission’s circular of July 2003, we inform you that the following financial institutes organise the financial services for the Ter Beke shares:
Fortis Bank, ING Bank, KBC and Petercam

6. Report of the Statutory Auditor on the half-year information on 30 June 2003

We have performed a limited review of the interim consolidated balance sheets as of June 30, 2003 of TER BEKE, NV, as well as the interim consolidated statement of income for the six months then ended. These interim consolidated financial statements have been prepared under the responsibility of the Management.

 Our limited review was made in accordance with the applicable recommendation of the Belgian Institute of Company Auditors, and consisted primarily of an analytical review and a discussion thereof with management. The scope of this review can not be compared with an audit in accordance with general accepted auditing standards.

Our limited review did not reveal any elements or facts that would make us conclude that the interim consolidated financial statements as of June 30, 2003 are not established in accordance with the accounting law and accounting principles of the company.

Consistent with our declaration on the annual account as of December 31, 2002, we would like to draw the attention to the note in the press release, regarding the ongoing dispute with the tax authorities. Although the Board of Directors is of the opinion that it has sufficient grounds to overturn the contested assessments and notices, and hence no provision has been recorded, the outcome of this dispute can not be determined with certainty.

The Statutory Auditor,

DELOITTE & PARTNERS, Bedrijfsrevisoren
Represented by
Guy Wygaerts and Gino Desmet
August 26,  2003