Wimm-Bill-Dann Foods OJSC Announces 3 Months 2003 Financial Results; Steady Growth in the Dairy Segment, Juice on Track towards Recovery.Business Editors MOSCOW, Russia--(BUSINESS WIRE)--June 23, 2003 Wimm-Bill-Dann Foods OJSC OJSC Open Joint Stock Company (NYSE NYSE See: New York Stock Exchange : WBD WBD Will Be Done WBD Wide Band Data Instrument (Cluster spacecraft) WBD Wideband Data ) today announced its financial results for the first quarter of 2003. During the first quarter of 2003, Wimm-Bill-Dann's sales increased by 13.4% compared to the first quarter of 2002. Gross profit increased by 16.3%, with gross margins rising to 29.3% compared to 28.6% last year. Net income decreased by 26%, primarily due to the combined effect of a temporary slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in juice sales growth as well as costs associated with expansion in the dairy dairy 1. a retail outlet for milk products. 2. the feeding and milking sheds on a dairy farm. 3. pertaining to or emanating from an animals or other thing concerned in the production of milk, e.g. dairy goat, dairy cleanser. segment. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become showed a slight decrease year-on-year. Commenting on the announcement, Sergei Plastinin, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Wimm-Bill-Dann Foods OJSC, said; "The first three months of this year saw continued growth in sales and improvement in gross margins. Over recent months, we have developed and launched a number of programmes such as better supply chain management, newly designed IT infrastructure and investment in technology and new equipment to enhance operational cycle and improve our cost structure. We are also in the process of improving our brand and product portfolio, launching new products and increasing the efficiency of our distribution and sales channels." Key Operating and Financial Indicators of Q1 2003
Q1 Q1 Change
2003 2002
-------------------
Sales volumes, thousand tons 374.1 338.0 10.7%
US$ US$
'mln 'mln
Sales 223.9 197.4 13.4%
Dairy 159.0 136.2 16.7%
Juice 64.9 61.2 6.0%
Gross Profit 65.7 56.5 16.3%
Selling and distribution expenses (32.2)(21.8) 47.7%
General and administrative expenses (17.7)(14.9) 18.8%
Operating income 14.6 18.4 (20.7)%
Financial income and expenses, net (4.7) (4.6) 2.2%
Net income 7.1 9.6 (26)%
EBITDA 21.6 21.8 (0.9)%
CAPEX including acquisitions 27.4 15.5 77%
In the first three months of 2003, Wimm-Bill-Dann's sales amounted to US$223.9 million, compared to US$197.4 million during the same period last year. Sales in Wimm-Bill-Dann's dairy segment in the first quarter increased by 16.7% from US$136.2 million in 2002 to US$159 million in 2003. Gross margins in the dairy sector grew to 26.7% from 25.4% last year due to a 5% drop in the cost of raw milk compared to last year, favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. price increases for sterilized ster·il·ize tr.v. ster·il·ized, ster·il·iz·ing, ster·il·iz·es 1. To make free from live bacteria or other microorganisms. 2. milk and a higher share of value-added val·ue-add·ed adj. Of or relating to the estimated value that is added to a product or material at each stage of its manufacture or distribution: products in the product portfolio. Sales in Wimm-Bill-Dann's juice segment increased by 6% from US$61.2 million in the first quarter of 2002 to US$64.9 million in the first quarter of 2003. Although sales slowed down in the first quarter following an exceptionally strong fourth quarter, we were able to improve our average price by 4.4% compared to the previous quarter. Pricing and volume growth were partially offset by increases in the cost of raw materials and the increased share of lower priced brands in the overall product portfolio. Gross margins in the juice division remained flat at 36%, the same as last year. The company's increased geographical ge·o·graph·ic also ge·o·graph·i·cal adj. 1. Of or relating to geography. 2. Concerning the topography of a specific region. ge coverage and investments in brand promotion continued to be the main cost drivers. Selling and distribution costs distribution costs distribute npl → Vertriebskosten pl increased substantially, from US$21.8 million during the first quarter of 2002 to US$32.2 million this year. During the first three months of 2003, US$9.5 million was spent on the personnel portion of selling and distribution expenses, and US$10 million on marketing and advertising, US$6.8 million on transportation costs and US$1.2 million on warehousing. During the first three months of 2003, general and administrative expenses were US$17.7 million. Net income decreased from last year and was US$7.1 million. EBITDA decreased slightly to US$21.6 compared to US$21.8 million during the first three months of 2002. Reconciliation of EBITDA to US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). Income before provision for income taxes and minority interest
Q1 2003 Q1 2002
Income before provision for income taxes
and minority interest 9,861 13,800
Interest expense 5,223 4,752
Depreciation and Amortization 6,537 3,199
------- --------
EBITDA $21,621 $ 21,751
======= ========
WIMM-BILL-DANN FOODS CONSOLIDATED con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2003 AND 2002 (Amounts in thousands of U.S. dollars, except share and per share data)
Three Three
months months
ended ended
March 31, March 31,
2003 2002
----------- -----------
(unaudited) (unaudited)
----------- -----------
SALES $ 223,866 $ 197,427
COST OF SALES (158,177) (140,955)
----------- -----------
Gross profit 65,689 56,472
SELLING AND DISTRIBUTION EXPENSES (32,248) (21,755)
GENERAL AND ADMINISTRATIVE EXPENSES (17,706) (14,905)
OTHER OPERATING EXPENSES (1,147) (1,376)
----------- -----------
Operating income 14,588 18,436
FINANCIAL INCOME AND EXPENSES, NET (4,727) (4,636)
----------- -----------
Income before provision for income taxes
and minority interest 9,861 13,800
PROVISION FOR INCOME TAXES (2,589) (3,404)
MINORITY INTEREST (215) (832)
----------- -----------
----------- -----------
NET INCOME $ 7,057 $ 9,564
----------- -----------
Earnings per share - basic and diluted: $ 0.16 $ 0.24
Weighted average number of shares outstanding 44,000,000 39,500,000
WIMM-BILL-DANN FOODS CONSOLIDATED BALANCE SHEETS consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. AS OF MARCH 31, 2003 AND DECEMBER December: see month. 31, 2002 (Amounts in thousands of U.S. dollars)
March 31, December
2003 31, 2002
----------- ---------
CURRENT ASSETS: (unaudited) (audited)
----------- ---------
Cash and cash equivalents $ 18,603 $ 29,340
Trade receivables, net 63,539 60,146
Inventory, net 82,085 86,063
Taxes receivable 77,370 68,352
Advances paid 23,883 10,811
Net investment in direct financing leases 1,254 1,338
Deferred tax asset 2,040 1,850
Other current assets 5,356 5,810
----------- ---------
Total current assets 274,130 263,710
PROPERTY, PLANT AND EQUIPMENT, net 315,804 293,580
INTANGIBLE ASSETS 2,764 2,736
GOODWILL 21,516 19,885
NET INVESTMENT IN DIRECT FINANCING LEASES
- long-term portion 4,023 4,381
INVESTMENTS 2,152 1,989
OTHER LONG-TERM ASSETS 1,248 2,812
----------- ---------
Total long-term assets 347,507 325,383
----------- ---------
Total assets $ 621,637 $ 589,093
=========== =========
CURRENT LIABILITIES:
Trade accounts payable $ 51,078 $ 40,144
Advances received 4,133 3,905
Short-term loans 94,684 94,050
Long-term loans, current portion 2,012 2,483
Bonds payable 16,303 16,096
Taxes payable 18,982 15,551
Accrued liabilities 8,606 8,346
Government grants - current portion 2,059 2,033
Other payables 33,027 25,770
----------- ---------
Total current liabilities 230,884 208,378
LONG-TERM LIABILITIES:
Long-term loans 4,163 4,546
Other long-term payable 54,383 55,047
Government grants - long-term portion 8,184 8,568
Deferred taxes 11,212 8,121
----------- ---------
Total long-term liabilities 77,942 76,282
----------- ---------
Total liabilities 308,826 284,660
----------- ---------
MINORITY INTEREST 22,042 21,549
----------- ---------
SHAREHOLDERS' EQUITY:
Common stock 29,908 29,908
Share premium account 164,132 164,132
Currency translation adjustment 828 -
Retained earnings 95,901 88,844
----------- ---------
Total shareholders' equity $ 290,769 $ 282,884
----------- ---------
Total liabilities and shareholders' equity $ 621,637 $ 589,093
=========== =========
WIMM-BILL-DANN FOODS CONSOLIDATED CASH FLOW STATEMENT FOR THE THREE MONTHS ENDED MARCH 31, 2003 AND 2002 (Amounts in thousands of U.S. dollars)
Three Three
Months Months
ended ended
March 31, March 31,
2003 2002
----------- -----------
(unaudited) (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 7,057 $ 9,564
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortisation 6,537 3,199
Bad debt and inventories provisions 1,572 109
Other adjustments (916) 1,050
Changes in operating assets and liabilities:
Decrease in inventories 4,780 17,173
Increase in trade accounts receivable (3,903) (2,303)
Increase in advances paid (12,822) (10,206)
Increase in taxes receivable (8,301) (1,653)
Decrease in other current assets 595 1,370
Increase in trade accounts payable 10,328 4,066
Increase in advances received 176 1,402
Increase in taxes payable 3,488 3,028
Increase (decrease) in accrued liabilities 152 (657)
Increase in other current payables 1,156 2,058
Decrease in other long-term payables (96) (90)
----------- -----------
Total cash provided by operating activities 9,803 28,110
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisitions of subsidiaries,
net of cash acquired $ (492)$ (192)
Cash paid for property, plant and equipment (16,497) (15,545)
Cash paid for net investments in direct
financing leases (48) (84)
Cash paid for acquisitions of investments - (416)
Proceeds from disposal of investments and
property, plant and
equipment 697 -
Cash paid for other long-term assets - (5,687)
Total cash used in investing activities (16,340) (21,924)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of capital stock,
net of direct expenses - 162,048
Government grants received - 786
Repayment in short-term loans (574) (34,389)
Repayment of long term payables (2,970) -
Proceeds from long-term loans - 7,000
Repayment of long-term loans (936) (6,086)
----------- -----------
Total cash (used in) provided by financing
activities (4,480) 129,359
----------- -----------
Total cash (used in) provided by operating,
investing and financing activities (11,017) 135,545
Impact of exchange rate differences on cash
and cash equivalents 280 (309)
----------- -----------
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS (10,737) 135,236
CASH AND CASH EQUIVALENTS, at beginning of
period 29,340 6,919
----------- -----------
CASH AND CASH EQUIVALENTS, at end of period $ 18,603 $ 142,155
=========== ===========
Some of the information contained in this press release may contain projections or other forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. regarding future events or the future financial performance of Wimm-Bill-Dann Foods OJSC, as defined in the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the U.S. Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements to conform them to actual results. We refer you to the documents Wimm-Bill-Dann Foods OJSC files from time to time with the U.S. Securities and Exchange Commission, specifically, the Company's most recent Form 20-F. These documents contain and identify important factors, including those contained in the section captioned "Risk Factors" in our Form 20-F, that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, potential fluctuations in quarterly results, and risks associated with our competitive environment, acquisition strategy, ability to develop new products or maintain market share, brand and company image, operating in Russia Russia, officially the Russian Federation, Rus. Rossiya, republic (2005 est. pop. 143,420,000), 6,591,100 sq mi (17,070,949 sq km). , volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the of stock price, financial risk management, and future growth. NOTES TO EDITORS Wimm-Bill-Dann Foods OJSC is a leading manufacturer of dairy and juice products in Russia. The company was founded in 1992. The company currently owns 23 manufacturing facilities in 19 locations in Russia and the Commonwealth of Independent States Commonwealth of Independent States (CIS), community of independent nations established by a treaty signed at Minsk, Belarus, on Dec. 8, 1991, by the heads of state of Russia, Belarus, and Ukraine. Between Dec. 8 and Dec. (CIS Cis (sĭs), same as Kish (1.) (1) (CompuServe Information Service) See CompuServe. (2) (Card Information S ), as well as affiliates in 26 cities in Russia and the CIS. The company also distributes its products in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). , Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. , the Netherlands, the Netherlands, The officially Kingdom of The Netherlands byname Holland Country, northwestern Europe. Area: 16,034 sq mi (41,528 sq km). Population (2005 est.): 16,300,000. Capital: Amsterdam. Seat of government: The Hague. Most of the people are Dutch. UK and the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , through both its own distribution network and independent distributors. Wimm-Bill-Dann has a strong and diversified diversified (di·verˑ·s branded portfolio with over 1,100 types of dairy products dairy products dairy npl → produits laitier dairy products dairy npl → Milchprodukte pl, Molkereiprodukte pl and over 170 types of juice, nectars and still drinks. The company currently employs over 18,000 people. Wimm-Bill-Dann was rated second best out of 42 firms in terms of transparency (1) The quality of being able to see through a material. The terms transparency and translucency are often used synonymously; however, transparent would technically mean "seeing through clear glass," while translucent would mean "seeing through frosted glass." See alpha blending. in the S&P survey of leading Russian companies This is a list of companies from Russia. See List of banks in Russia for banks. Company Industry MICEX RTS 1C Company Software - - Acron (company) Chemicals - RTS:B>AKRN Aeroflot Airlines MICEX:B>AFLT RTS:B>AFLT Alfa Group Investment - - , and was rated fourth best in the latest Brunswick Brunswick, cities, United States Brunswick. 1 City (1990 pop. 16,433), seat of Glynn co., SE Ga., on St. Simon's Sound near the Atlantic coast; laid out 1771–72, inc. 1856. It is a port of entry with numerous container docks. UBS UBS Union Bank of Switzerland UBS United Bible Societies UBS United Blood Services UBS United Buying Service UBS Used Bookstore UBS University Business Services UBS Universal Building Society (UK) UBS Ulaanbaatar Broadcasting System Warburg War·burg , Otto Heinrich 1883-1970. German biochemist. He won a 1931 Nobel Prize for research on the respiration of cells. survey of corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. in Russia. Wimm-Bill-Dann was awarded best European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Equity Deal of 2002 by Euroweek and Institutional Investor Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. magazines. |
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