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PRESS RELEASE

2007 Half-year results - Ter Beke confirms growth

 

Waarschoot, 31 August 2007.

1. Headlines for the 1st half of 2007

Group key figures:

• Total turnover up by 18.8% from 149.3 million EUR to 177.4 million EUR;
• EBITDA up by 21.4% from 11.0 million EUR to 13.4 million EUR;
• Result after income taxes up by 9.7% to 2.6 million EUR compared to 2.3 million EUR in 2006;
• Net cash flow up by 16.9% from 9.2 million EUR to 10.8 million EUR;
• Rising raw material prices put pressure on the margins;
• Sharply increased interest charges.

Processed Meats Division: TerBeke-Pluma:

• Strong turnover increase, mainly attributable to the inclusion of the Pluma figures in the consolidation for 6 months compared to three months in 2006;
• Continued growth in sliced and pre-packaged processed meats;
• Acquisition of SDF Foods Ltd. in the United Kingdom;

Ready Meals Division: FreshMeals:

• Further turnover growth;
• Discussions stopped concerning acquisition of Normandie Plats Cuisinés in France;
• Accelerated implementation of capacity investments at the Marche-en-Famenne plant;
• Renegotiation of less profitable contracts in the French market.

 2 . Consolidated key figures for the 1st half of 2007

2.1. Profit and loss account in '000 Euro
 

2.2 Key figures per share

3. Notes to the accounts

3.1 Turnover

Processed meats - TerBeke-Pluma - While the results of the Pluma Group in the first half of 2006 were included in the consolidation for only three months (from 1 April 2006), the consolidated figures for the first half of 2007 include six months of activities of the Pluma Group.

This largely explains the group's sharp turnover increase of 18.8% from 149.3 to 177.4 million EUR, but even ignoring the turnover of the Pluma Group the turnover of the processed meats division enjoyed a slight increase.

In line with the trend of recent years, we see in the meat sector a further increase in the sale of pre-packaged processed meats and a decrease in the sale of over-the-counter products.

In January 2007, the group acquired the English agent SDF Foods Ltd. in order to strengthen its position on the UK market.

Ready Meals - FreshMeals - The turnover increase in the fresh ready meals sector continues the trend of recent years. In the first half of 2007 an increase of around 6% was achieved compared to the first half of 2006.

3.2 Result of operating activities

The result of the operating activities rose by 1.0 million EUR (+24.6%) compared to 2006, notwithstanding strong pressure on the margins as a result of rising raw material prices.

As announced earlier, in 2006 a number of contracts were concluded in the French market at margins that were too low. In the meantime, a number of these contracts have been renegotiated or discontinued, which will primarily influence the results of the second half of the year.

Via major brand investments, Come a casa was able to further strengthen its position as market leader in Belgium during the first half of 2007.

At the end of May the group announced that the discussions about the possible acquisition of Normandie Plats Cuisinés had been stopped. The costs of the due diligence investigation, which amounted to around 200,000 EUR, were charged in full against the result.

Also in the first half of 2007 a number of one-time expenses were incurred within the framework of the separation of the group´s 2 core businesses into 2 independent branches effective 1 January 2007.

The increase in depreciations by around 1.1 million EUR also had a negative impact on the result of the first half of 2007. This increase is primarily the consequence of the merger with Pluma and the implementation of the 2006-2007 investment programme.

3.3 Net finance costs

The net finance costs rose by 0.9 million EUR compared to the first half of 2006.

This increase is above all the consequence of the merger with the Pluma Group. Both the effect of the financing of the cash component of this merger during 6 months in 2007 compared to only 1.5 months in 2006 (the transaction was ratified on 18 May 2006) and the effect of 6 months of finance costs of the Pluma Group in 2007 compared to 3 months in 2006 play a role in this.

The finance charges also rose higher as a result of the acquisition of SDF Foods Ltd. at the beginning of 2007 and the further implementation of the 2006-2007 investment programme.

The equity ratio amounts to 31.4% on 30 June 2007 compared to 32.0% on 30 June 2006.

3.4 Investments

In the first half of 2007 Ter Beke invested 11.9 Million EUR in tangible fixed assets.

The most important investment projects concern a number of new slicing and packaging lines for processed meats, the continuation of the legally required conversion to freon-free cooling installations, and above all the accelerated implementation of the capacity investments at the Marche-en-Famenne plant.

3.5 Taxes

The decrease in the tax rate from 31.1% in 2006 to 27.1% in 2007 is mainly the consequence of the realisation of an previously unrecognised tax asset in the Netherlands.

4. Prospects

In 2007 the group will continue to work on improving the profitability of the activities, both in its processed meats branch TerBeke-Pluma and in its ready meals branch FreshMeals.

The market is currently facing significant increases in raw material prices. The group is proceeding on the assumption that it will be able to pass these price increases on.

Unless the market environment deteriorates or there are new unanticipated price increases, the group expects that the result for the full year 2007 will at least equal the result of 2006.

5. Financial services

Financial services relating to the Ter Beke share are provided by the following financial institutions: Fortis Bank, ING Bank, KBC, Bank Degroof and Petercam NV.

6. Report of the Statutory Auditor on the half-year information on 30 June 2007

"To the Board of Directors

We have performed a limited review of the accompanying consolidated balance sheet and income statement (jointly the "interim financial information") of TER BEKE NV ("the company") and its subsidiaries (jointly "the group") for the six months period ended 30 June 2007. The Board of Directors of the company is responsible for the preparation and fair presentation of this interim financial information. Our responsibility is to express a conclusion on this interim financial information based on our review.

The interim financial information has been prepared in accordance with the recognition and measurement criteria of IFRS as adopted by the European Union.

Our limited review of the interim financial information was conducted in accordance with the recommended auditing standards on limited reviews applicable in Belgium, as issued by the "Institut des Reviseurs d'Entreprises/Instituut der Bedrijfsrevisoren". A limited review consists of making inquiries of group management and applying analytical and other review procedures to the interim financial information and underlying financial data. A limited review is substantially less in scope than an audit performed in accordance with the auditing standards on consolidated annual accounts as issued by the "Institut des Reviseurs d'Entreprises/Instituut der Bedrijfsrevisoren". Accordingly, we do not express an audit opinion.

Based on our limited review, nothing has come to our attention that causes us to believe that the interim financial information for the six months period ended 30 June 2007 is not prepared, in all material respects, in accordance with legal and regulatory requirements and the recognition and measurement criteria of IFRS as adopted by the European Union.

30 August 2007

The Statutory Auditor
________________________________
DELOITTE Reviseurs d'Entreprises
SC s.f.d. SCRL
Represented by Dirk Van Vlaenderen"

For more information, please contact:

Media Luc De Bruyckere Chairman Tel.: +32 (0)9 370 13 00 E-mail: luc.debruyckere@terbeke.be

Investor Relations René Stevens CFO Tel.: +32 (0)9 370 13 45 E-mail: rene.stevens@terbeke.be

 

TER BEKE IN BRIEF


Ter Beke (Euronext Brussels: TERB) is an innovative Belgian fresh food group which markets its assortment in 10 European countries. The group has 2 core businesses: processed meats and fresh ready meals, possesses 9 industrial establishments in Belgium, the Netherlands and France and counts over 1,700 employees.

Processed Meats Division: Ter Beke - Pluma

• producer of processed meats for the Benelux and pâté for Germany and the United Kingdom
• 5 production sites in Belgium (Wommelgem, Waarschoot, Marche-en-Famenne, Herstal and Ruiselede) and 3 centres for slicing and packaging of processed meats, including 2 in Belgium (Wommelgem and Veurne) and 1 in the Netherlands (Milsbeek)
• innovative in the segment of pre-packaged processed meats
• distribution brands and own brand names L´Ardennaise, Daniël Coopman and Pluma
• about 900 employees

Ready Meals Division: Fresh Meals

• producer of fresh ready meals for the European market
• market leader in fresh lasagne in Europe
• 3 production sites, including 2 in Belgium (Wanze and Marche-en-Famenne) and 1 in France (Alby-sur-Chéran)
• brand names Come a Casa, Pronto and Vamos along with distribution brands
• approximately 800 employees