Sales performance 2008

Emmi records 7.7% increase in sales - growth in all product groups

Lucerne, 4 February 2009 - Emmi posted net sales of CHF 2,693 million for the 2008 financial year, which corresponds to a 7.7% increase. All product groups contributed to solid growth, 4.6% of which stemmed from price increases. Brand concepts such as Emmi Caffè Latte, Emmi Kaltbach and, increasingly, the Emmi Swiss line and products with added health benefits such as Emmi Benecol and Aktifit continued to perform well.

Emmi Group net sales in 2008

Net sales in Switzerland/international

Net sales by product group

In the financial year 2008, Emmi achieved net sales of CHF 2,693 million, or 7.7% growth (prior year: CHF 2,501 million). Organic growth was 6.6%, or 6.7% in Emmi's home market of Switzerland and 6.2% outside Switzerland.

Net sales in Switzerland rose by 8.0% to CHF 2,067 million (prior year: CHF 1,914 million). All product groups contributed to this growth, approximately half of which was due to inflation.

Emmi saw sales increase by 6.6% to CHF 626 million (prior year: CHF 587 million) in international markets; in local currency terms, international growth equalled 7.7%. Positive developments in brand concepts and specialities for fresh products and cheese played a strong role, although the majority of growth was derived from price increases.

Broadly diversified growth

In 2008, classic dairy products (milk, cream and butter) grew by 6.6% to CHF 804 million (prior year: CHF 754 million). Growth was largely due to price increases in the wake of higher raw materials costs but also partly a result of volume growth.

Emmi's fresh products grew by 8.2% last year to CHF 581 million (prior year: CHF 537 million). Primary growth drivers were again successful products such as Emmi Caffè Latte, Emmi Benecol and Aktifit. The Emmi Swiss line, including Swiss Müesli and Swiss Yoghurt, was launched in 2007; it sold very well in 2008, following its wide roll-out mainly in Germany.

Emmi posted net cheese sales of CHF 881 million in 2008 (prior year: CHF 820 million), representing 7.5% growth. Emmi maintained a solid level of performance in Switzerland, particularly with natural cheese. Internationally, cheese sales were very satisfactory especially in the key markets of Germany and the USA, reaching growth of 6.2%. Emmentaler AOC was subject to volume pressure caused by price increases, particularly in its key market of Italy, which led to declining exports. Brand concepts such as Emmi Kaltbach and cheese varieties (mainly Le Gruyère AOC, but also traditional fondue and raclette cheese products) performed especially well.

Emmi's takeover of a significant production order offset high import pressure in fresh cheese, resulting in 11.6% growth to CHF 140 million (prior year: CHF 125 million).

Sales in powder/concentrates rose by 2.7% in 2008 to CHF 90 million (prior year: 88 million), primarily from increased exports in response to milk market pressure in the second half of 2008.

Sales in other products/services rose by 10.7% to CHF 196 million (prior year: CHF 177 million), due to positive developments in trading as well as growth in Mittelland Molkerei's fresh products service.

Focused market development

Because Emmi is focused on the further expansion of its key markets, it has decided to work with local partners for its Scandinavian business activities going forward. As a result, its subsidiary Emmi Nordic AB in Gävle will cease operations at the end of February 2009.

Stable Swiss consumption and slower international growth

Emmi expects to reach its earnings target of a 2%+ net profit margin for 2008. For 2009, the company has forecast stable Swiss consumption with falling prices due to lower raw materials costs. Outside Switzerland, Emmi anticipates lower consumer confidence and potentially negative currency effects, resulting in a slowdown in international business.

Detailed figures for the Emmi Group's financial year 2008 plus an outlook for 2009 will be announced at the analysts' and media conference on 8 April 2009.