Bakkavör Group hf. - Financial Statement Release

Bakkavör Group's Results for Q3 and the first nine months 2009

PROFIT PERFORMANCE AND CASHFLOW CONTINUE TO IMPROVE - STRONG RECOVERY 

Highlights

• Q3 EBITDA* up significantly 45% to £45.2 million (Q3 2008: £31.1 million) 

• Significantly improved EBITDA* margin in Q3 2009 at 10.6% compared to 7.7% in
Q3 2008 

• Net Profit of £4.2 million in 9M compared with a loss of £55.9 million in 9M
2008, a significant turnaround of £60.1 million 

• UK fresh prepared foods sales continue to accelerate with 7%** growth in the
quarter, driven by  strong performance in ready meals 

• Cashflow from operations, excluding one-off restructuring costs, almost
doubled on Q3 2008, up 86%, to £66.5 million 

• On track to achieve the full-year EBITDA* target of £130 million, a 20%
increase year-on-year 

Ágúst Gudmundsson, Chief Executive Officer:

With our EBITDA up 45% in Q3 2009, our results demonstrate that we are
achieving a strong recovery in the Group's performance and are well on track to
achieve our full-year forecast. We are once again generating good cashflow,
reflecting the improved profitability of the business and greater control of
working capital. The improved profit performance was underpinned by increased
sales volumes and improved operational efficiencies generated through our
restructuring activities. This was achieved despite the backdrop of a
challenging trading environment with increased promotional costs and on-going
inflationary pressures. 

We are making strong headway in our core UK fresh prepared foods business
driven by sales uplifts of 13% in ready meals in Q3 2009, reflecting our solid
market position in our key categories. 

Furthermore, we have made significant progress in our discussions with the
lenders to our Icelandic holding company. We have reached agreement in
principle with parties representing around 70% of the holding company debt on
heads of terms which include the extension of the maturities to 2014.
Discussions on the final terms of the agreement are ongoing and we expect to
announce a conclusion shortly. This is an important milestone in securing the
funding of the Group and follows the successful refinancing of the operating
businesses, which are funded independently of the holding company, and have
fully committed facilities to March 2012. 

Whilst we expect trading conditions to remain challenging we are very confident
that the actions we have taken and the fundamental growth proposition we offer
will drive significant profit growth in the years to come. 


Key Contacts:

Ágúst Gudmundsson,
CEO
Tel: +354 550 9700
Richard Howes	
CFO
Tel: +354 550 9700

Charlie Armitstead/Hazel Stevenson 
Financial Dynamics
Tel: +44 207 269 7275



*EBITDA excluding restructuring costs
** Adjusted to reflect sales resigned in restructuring process

Attachments:

bakk q3 2009 press release.pdf