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Waterford Wedgwood PLC, "Waterford Wedgwood", Record Interim Results for the Six Months ended 30 June 2000.

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 Record Interim Results for the Six Months ended 30 June 2000
 ----------------------------------------------------- -----------
 Six Months to Six Months to
 30 June 2000 30 June 1999
 euro million euro million % change
 Sales - total 447.0 342.6 30%
 - crystal 178.0 150.4 18%
 - ceramics 202.7 171.4 18%
 - other 66.3 20.8 219%
 Operating profit(a) 29.5 21.3 38%
 Pre-tax profit(a) 18.2 13.9 31%
 Earnings per share(a) 2.24c 1.73c 30%
 Dividend per share 0.66c 0.57c 15.5%
 ----------------------------------------------------- -----------
 (a) Before goodwill amortisation

-- Record sales up 30% to euro447.0 million -- Record operating profit up 38% to euro29.5 million -- Record pre tax profit of euro18.2 million, up 31% -- Earnings per share up 30% to 2.24c: compound growth of 13% per

annum over past five years -- Acquisition of Hutschenreuther brand for euro10.2 million

- earnings enhancing in first year

- increases Waterford Wedgwood's market share in Germany to over


- improves Rosenthal's capacity utilisation and margins
-- Waterford sales momentum continues

-- Recovery in Asian and Japanese markets with Wedgwood ceramic sales increased
by 78% and 15% respectively

-- US growth continues with significantly increased sales in all

brands -- All-Clad achieved outstanding six month sales of euro43.2 million,

up 40% -- Current trading remains buoyant

"These record results consolidate a decade of sustained profitable growth for Waterford Wedgwood and highlight the success we have achieved in creating one of the world's leading luxury lifestyle brand companies.

"With our increasing portfolio of prestige brands all performing strongly across the globe, we are well positioned to generate future profitable growth in decades to come."

Dr Anthony J F O'Reilly


23 August 2000


Waterford Wedgwood Tel: (today) 0498 843276 Richard Barnes, Group Finance Director Tel: (thereafter) + 44 1782 282299

College Hill Associates (UK and Europe) Tel: + 44 207 457 2020 Kate Pope / James Henderson

Dennehy Associates (Ireland) Tel: + 353 1 676 4733 Michael Dennehy

Vorhaus Public Relations (United States) Tel: + 212 554 7433 Robbie Vorhaus / Abbe Ruttenberg

The Interim Results presentation is available on the Waterford Wedgwood Website

Waterford Wedgwood plc

Chairman's Statement

I am delighted to report that Waterford Wedgwood achieved record group sales in the first six months of 2000, building upon a remarkable decade of sustained profitable growth. This represents the strongest growth in the Group's history, following our last year's record-breaking full year increase of 20%. Waterford Wedgwood's continuing success confirms last year's achievement as heralding an era in which our Group begins to reap the accumulating benefits of our strategic planning, capital investment and brand acquisitions.

Since 1991, we have successfully built one of the world's leading luxury lifestyle brand companies under the Waterford Wedgwood banner, including Waterford, Wedgwood, Rosenthal, All-Clad, Marquis and now Hutschenreuther. Our momentum shows every sign of continuing, as we acquire luxury brands, as conditions improve in some of our most important world markets, particularly Asia and Europe, and as our brands continue to gain market share.

Financial Results

In the first half of 2000, Waterford Wedgwood's group sales grew to Euro447.0 million (1999: Euro342.6 million), an increase of 30% and operating profit increased by 38% to a record-breaking Euro29.5 million (1999: Euro21.3 million), clearly demonstrating the sustainability of our growth. Group pre-tax profit before goodwill amortisation increased by 31% to Euro18.2 million (1999: Euro13.9 million).

Earnings per share before goodwill amortisation increased by 30% to 2.24c; this represents a compound growth of 13% in the past five years. The Board of Directors is proposing an interim dividend of 0.66c (1999: 0.5714c), up 15.5%, to be paid on 1 December 2000 to shareholders on the register on 13 October 2000. A scrip dividend alternative will be available to shareholders.

Acquisition of Hutschenreuther brand

Continuing our strategy of building a group of prestige brands and optimising the efficiency of our business operations, Waterford Wedgwood, through its German subsidiary Rosenthal, has acquired the Hutschenreuther brand for a consideration of Euro10.2 million. The consideration represents 20% of Hutschenreuther's 1999 sales of Euro50 million. After including working capital requirements and investment associated with the integration of Hutschenreuther, the cash payback is projected to be three years. This important acquisition is earnings enhancing from year one.

Waterford Wedgwood has acquired the brand, current inventory and the intellectual property rights as well as the lease of Hutschenreuther's five distribution outlets. Hutschenreuther will be integrated into Rosenthal's manufacturing facilities within two years. The Bavarian government has agreed to provide the Group with operational grants to assist with the integration.

The integration of the Hutschenreuther brand into Rosenthal's manufacturing facilities will be materially beneficial to Rosenthal through increased capacity utilisation and improved margins. Through the acquisition, Rosenthal has captured the largest single share of the German market - over 33% - and increased its scale by approximately one-third. This will further improve Rosenthal's operating efficiency in the long term.

Crystal (40% of Group sales)

Our phenomenal success of 1999 continued through the first half of 2000 with Group crystal sales up 18% to Euro178 million and Waterford brand sales increasing by 21% overall, with sales in the US up 6%, UK up 10%, Ireland up 18% and Australia up 23%.

New product development continues as the key driving force of our growth and new products will account for 40% of crystal sales this year. "Gifts of Expression", an innovative crystal giftware range which will be launched this autumn, is a particularly exciting prospect. On top of the success of our new product, we have also been able to increase sales of traditional products, clearly demonstrating the strength of our core business.

Line and brand extensions continue to drive sales, with John Rocha sales up 37% to Euro5 million and Jasper Conran sales ahead of expectations at Euro1.7 million. Overall, Waterford line and brand extensions were worth approximately Euro38 million at retail - a year on year increase of over 80%.

These strategies will continue to attract new consumers to our brands as well as keep existing customers loyal. With continued sales momentum in 2000, an ever wider brand awareness, and success well spread by market and by product, we will continue to advance sales and profits.

Ceramics (45% of Group sales)

Outstanding progress was made in 2000, with ceramics sales up 18% to Euro202.7 million and within this, Wedgwood brand sales up by 22%.

Sales in the all-important US market were up 15%, a highly encouraging development due to continuing new product introductions and to the energetic promotional efforts of Sarah, Duchess of York. The recovery taking place in the Asian and Japanese markets significantly enhanced Wedgwood's sales. These increased by 78% and 15% respectively, demonstrating the success of our strategic investment in new products and new retail environments in Japan. All markets were ahead of last year with Continental Europe up 15%, UK and Ireland up 3% and Australia up 16%.

Wedgwood is well advanced on the repositioning of its brand to reflect the core values of "Authentic English Style." This includes a new brand advertising campaign, stunning new retail fixturing and new products which meet the consumer demand for "special casual" and exciting design. New collections by designers Nick Munro and Paul Costelloe have brought freshness, excitement and a very positive customer response.

The Rosenthal brand has seen a strong improvement during the first half of 2000, with an increase in sales of 5%, despite the continuing difficult conditions in its home market. Rosenthal's operations in the US increased sales by 29% with the continued focus on design orientated product ranges accelerating this sales momentum. Rosenthal has successfully launched several new product ranges as well as benefiting from the continuing success in sales of its sought-after Bvlgari and Versace luxury ranges.

With the acquisition of Hutschenreuther, a marvellous German brand and previously a significant rival, the Group has vastly increased its market share in Germany to over 33% and is certain to benefit strongly from the restructuring of this crowded market.

Other Products (15% of Group sales)

Sales in this category were Euro66.3 million, an increase of 219%, primarily reflecting the acquisition of All-Clad. The launch of our Wedgwood cutlery and Waterford Fine Jewelry collections exceeded expectations. We will continue to enhance our world class brand names with appropriate product diversification and development.

All-Clad - acquired in June 1999 - made a significant contribution to the Company's half year results and achieved outstanding first half sales of Euro43.2 million - up 40%. America's foremost luxury cookware brand has already gained significant benefits from joining the Group's strong American organisation. The launch of the new Emeril Lagasse cookware range has proven exceedingly successful with sales of Euro2.2 million and has significantly broadened All-Clad's presence in the US cookware market. The planned expansion of All-Clad outside the US will provide an excellent platform to accelerate future growth.

Strategic Initiatives

Today Waterford Wedgwood is among the world's leading luxury lifestyle companies. We believe that the strength of our core brands, the design, quality and craftsmanship of our products and our clear strategy for growth, will enable us to continue to achieve ever-growing sales and profits.

We have increased our focus on our distribution network, nurturing and developing our distribution channels.

Our world class brands have strong e-commerce appeal and we have a focused internet strategy in place. Alongside our corporate website, we are working towards the creation of a carefully considered e-commerce capability in 2001.


The first half of 2000 was one of significant progress for the Group. I want to take this opportunity to offer my sincere gratitude to employees around the world. Thanks to their skills and total commitment, Waterford Wedgwood has not only achieved a decade of sustained profitable growth, it has broken every record in our corporate history for sales and profits yet again in this first half of 2000.

Waterford Wedgwood has grown its core business and now overshadows its competition. The Group has made an acquisition in each of the last three years and with gathering pace improves its financial performance consistent with the luxury lifestyle brands company it has become.

Current trading remains buoyant. I look forward to the rest of 2000, and to the years ahead, with great confidence and genuine enthusiasm.

Dr Anthony JF O'Reilly


23 August 2000


 Consolidated Profit and Loss Account

 6 months ended 12 months ended
 (unaudited) (audited)
 30.06.00 30.06.99 31.12.99
 Notes euro m euro m euro m
Sales by category
Crystal 178.0 150.4 395.2
Ceramics 202.7 171.4 396.8
Others 66.3 20.8 87.6
TOTAL GROUP SALES 447.0 342.6 879.6
Group operating
profit before
goodwill amortisation 29.5 21.3 86.1
Goodwill amortisation (2.7) (0.5) (3.2)
Net interest payable (11.3) (7.4) (17.4)
Profit on ordinary
activities before taxation 15.5 13.4 65.5
Taxation on profit
on ordinary activities (2.6) (2.0) (9.4)
Profit on ordinary
activities after taxation 12.9 11.4 56.1
Minority interests 0.8 0.7 0.9
Profit attributable
to members of the
parent company 13.7 12.1 57.0

Dividends 3 (5.1) (4.2) (19.1)
Retained profit
for the period 8.6 7.9 37.9
Earnings per
ordinary share
before goodwill
amortisation 4 2.24c 1.73c 8.26c
Earnings per
ordinary share 4 1.87c 1.66c 7.82c


 Consolidated Balance Sheet

 As at As at
 Notes (unaudited) (audited)
 30.06.00 30.06.99 31.12.99
 euro m euro m euro m
Fixed assets:

Intangible assets 5 102.0 107.1 104.8
Tangible assets 266.1 239.9 259.5
Financial assets 23.3 7.1 22.6
 391.4 354.1 386.9
Current assets:

Stocks 309.3 266.7 238.8
Debtors 156.5 150.0 167.0
Cash and deposits 53.4 46.3 87.4
 519.2 463.0 493.2
Creditors (amounts
falling due within
 one year) (166.7) (166.1) (202.3)
Net current assets 352.5 296.9 290.9
Total assets less
 current liabilities 743.9 651.0 677.8
Creditors (long
 and medium term debt) (442.8) (398.4) (396.6)
Other long term
creditors (32.3) (36.5) (33.5)
Provisions for
 liabilities and charges (9.8) (8.5) (8.6)
 259.0 207.6 239.1
Capital and reserves:

Called up share capital 54.2 56.5 56.6
Share premium account 176.9 175.8 176.7
Revaluation reserve 10.8 10.8 10.8
Revenue reserves 12.1 (38.5) (8.1)
Capital conversion reserve fund 2.6 - -
Shareholders' funds -
equity interests 256.6 204.6 236.0
Minority interests -
equity interests 2.4 3.0 3.1
 259.0 207.6 239.1


 Consolidated Cash Flow

 6 months 12 months
 ended ended
 (unaudited) (audited)
 30.06.00 30.06.99 31.12.99
 euro m euro m euro m

Operating profit 29.5 21.3 86.1
Depreciation 19.5 18.8 37.9
Working capital (74.4) (51.8) 9.2
Cashflow from operations (25.4) (11.7) 133.2
Restructuring (3.5) (19.8) (32.3)
Interest (11.3) (7.4) (17.4)
Capital expenditure (net) (26.8) (11.0) (41.8)
Issue of treasury shares 8.6 - -
Taxation paid (9.2) (1.5) (5.2)
Dividends paid (13.1) (12.8) (17.2)
Other (3.5) (3.0) (17.0)
Net Group cashflow (84.2) (67.2) 2.3
Investment in Royal Doulton - - (17.3)
Acquisition of subsidiaries - (106.0) (106.0)
Opening debt (311.8) (190.8) (190.8)
Closing debt (396.0) (364.0) (311.8)


 Statement of total recognised gains and losses

 6 months 12 months
 ended ended
 (unaudited) (audited)
 30.06.00 30.06.99 31.12.99
 euro m euro m euro m

Profit for the period 13.7 12.1 57.0
Exchange translation
effect on net overseas
investments 0.6 16.5 16.5
Total recognised
 gains for the year 14.3 28.6 73.5
Scrip dividend 2.4 - 0.4
Dividend (5.1) (4.2) (19.1)
Issue of treasury shares 8.6 - -
New share capital
subscribed 0.4 0.2 1.2
Shareholders' funds
at beginning of period 236.0 180.0 180.0
Shareholders' funds
at end of period 256.6 204.6 236.0

Notes to the Interim Financial Statements

1. Basis of preparation of Interim Financial Statements

This interim statement has been prepared applying the accounting

policies described on page 13 of the 1999 Accounts.

The results for six months ended 30 June 2000 have been reviewed

by PricewaterhouseCoopers. The results for the twelve months ended

31 December 1999 are in abbreviated form and have been extracted

from the Accounts which have been filed with the Registrar of

Companies. The Auditors' Report on those accounts was unqualified.

2. Exchange Rates

The exchange rates used between the euro and the principal

currencies in which the Group does business were as follows:

 Profit and loss transactions
 6 months ended 12 months ended
 30.06.00 30.06.99 31.12.99

 U.S. Dollar $0.96 $1.09 $1.06
 Sterling (pound)0.61 (pound)0.67 (pound)0.66
 Yen Y102.65 Y129.04 Y121.33

 Balance sheet as at
 30.06.00 30.06.99 31.12.99
 U.S. Dollar $0.95 $1.03 $1.00
 Sterling (pound)0.63 (pound)0.65 (pound)0.62
 Yen Y100.20 Y124.03 Y102.93

3. Dividends

 6 months ended 12 months ended
 30.06.00 30.06.99 31.12.99
 euro m euro m euro m

 1999 interim dividend - 4.2 4.2
 1999 final dividend - - 14.9
 Adjustment relating
 to 1999 final dividend(a) 0.2 - -

 2000 interim dividend 4.9 - -
 5.1 4.2 19.1

(a) This adjustment reflects the difference between the

estimated exchange rate used to calculate dividend payable

and the rate prevailing when the dividend was paid.

It is proposed to pay the interim dividend of 0.66 cents per

share (1999: 0.5714 cents) on 1 December 2000 to all

shareholders on the register at the close of business on 13

October 2000. Shareholders will receive the dividend on their

ordinary shares (from Irish sourced profit) unless they elect

to receive their dividend on their income shares (from UK

sourced profit). Elections, once submitted, remain in force

unless or until cancelled by the shareholder. It is also

proposed to offer a scrip dividend alternative with this

dividend and to post scrip dividend election forms to

shareholders on 26 October 2000. The last date for receipt of

scrip dividend mandates/ revocations will be 17 November 2000

and the first date for dealing in new stock units is 1

December 2000.

4. Earnings per Ordinary Share

The calculation of earnings per ordinary share is based on 732.2

million shares being the weighted average number of shares in

issue during the six months ended 30 June 2000 (1999: 728.2

million). On the face of the consolidated profit and loss account,

earnings per share are shown both before and after goodwill

amortisation. Fully diluted earnings per share are not materially

different to the reported earnings per share.

5. Intangible Assets - Goodwill

 euro m
 Balance at 31 December 1999 104.8
 Goodwill amortised (2.7)
 Exchange (0.1)
 Balance at 30 June 2000 102.0

6. Net Debt

Net debt at 30 June 2000 comprising finance leases, short and long

term borrowings less cash and deposits, amounted to e396.0 million

(1999: e364.0 million).

Information for US Investors (NASDAQ : WATFZ)

The Group prepares its financial statements using generally

accepted accounting principles (GAAP) applicable in the Republic

of Ireland. The principal differences between US GAAP and Irish

GAAP affecting the Group concern the treatment of foreign currency

hedging transactions, pension cost, the amortization of goodwill,

the provision for deferred taxes and accounting for stock based

compensation expense which are further explained in notes (i) to


 6 months ended (unaudited)
 30 June 2000 30 June 1999
 euro m euro m
 Under US GAAP

 Net sales 447.0 342.6
 Net loss (0.1) (26.2)
 Net loss per ADS (0c) (36c)
 Shareholders' equity (including
 unamortized goodwill) 399.2 369.2

Each ADS represents 10 stock units. A stock unit comprises one

ordinary share of Waterford Wedgwood plc of 6c and one income

share of Waterford Wedgwood UK plc of Stg. 1p.

(i) The Group uses forward currency contracts to hedge foreign

exchange exposures on anticipated income and expenditure.

Under Irish GAAP, these forward contracts are translated into

euros at the contract rate once the transaction giving rise to

the currency exposure is recognised. However, under US GAAP,

unrealized gains and losses on all contracts yet to expire are

measured at each balance sheet date and included in the

statement of income for the period then ended.

The effect of the adjustments for forward contracts at 30 June

2000 was to decrease net income (under US GAAP) by e9.1

million (1999: decrease net income by e38.6 million).

(ii) Under Irish GAAP, the expected cost of providing pensions to

employees is charged to the income statement as incurred over

the period of employment of pensionable employees, following

triennial actuarial valuations of scheme assets and

obligations. Any surplus or deficit of plan obligations over

plan assets is amortized, in a systematic manner, to the

income statement over the expected future service lives of the

active employees. Under US GAAP, any surplus or deficit is

determined on an annual basis by reference to the market

values of assets and any excess above a predetermined level is

amortized to the statement of income over the average

remaining service lives of active employees. The effect of the

adjustment for pension cost at 30 June 2000 was to decrease

net income (under US GAAP) by e2.4 million (1999: decrease net

income by e1.0 million).

(iii) Under Irish GAAP, goodwill arising prior to 1 January 1998

was written-off immediately upon acquisition against

shareholders' equity. After 1 January 1998, goodwill arising

upon acquisition is capitalized and written-off through the

income statement over its expected useful life of 20 years.

Under US GAAP, accounting for goodwill as an offset against

shareholders' equity has always been impermissible, thus

goodwill is amortized over the period of its expected useful

life, subject to a maximum write-off period of 40 years,

through the statement of income. The effect of the adjustment

for amortization of goodwill at 30 June 2000 was to decrease

net income (under US GAAP) by e3.3 million (1999: e3.2


(iv) Under Irish GAAP, no provision is made for deferred taxation

if there is reasonable evidence that such deferred taxation

will not be payable in the foreseeable future. US GAAP adopts

an asset and liability approach that requires the recognition

of deferred tax assets and liabilities for the expected future

tax consequences of all events that have been recognized in

the Company's financial statements or tax returns. In

estimating future tax consequences, generally all expected

future events are considered other than enactments of changes

in the tax law or rates. The effect of adjustments for

deferred taxes at 30 June 2000 was to increase net income

(under US GAAP) by e1.8 million (1999: increase net income by

e4.6 million).

(v) The Group operates a number of executive option and employee

SAYE stock option schemes. The amounts payable under these

schemes are determined on the basis of the market price of the

shares at the time of grant of the options. However, as

certain of the options do not vest until performance targets

are achieved the number of shares that may be acquired is not

fully determinable until after the date of grant. Under Irish

GAAP the Group's incentive and employee options do not result

in charges against income.

Under US GAAP, the Group follows the measurement principles of

APB 25 - Accounting for Stock Issued to Employees (`APB 25'),

under which compensation expense is accrued and booked to

income over the vesting period. The vesting period commences

when it becomes probable that the underlying targets attaching

to the options will be achieved and the number of shares will

be known and ends with the date when the granting of the

shares is not contingent upon the performance of additional

services or other conditions. Compensation expense is booked

on a period by period basis to reflect the difference between

the price payable to acquire the shares under option and the

market price of the shares at the end of each accounting

period until the final vesting date. The effect of the

adjustment for stock based compensation expense at 30 June

2000 was to decrease net income (under US GAAP) by e0.8

million (1999: enil).

 Reconciliation of US and Irish GAAP

 6 months ended (unaudited)
 30 June 2000 30 June 1999
 euro euro

Net income per ADS - US GAAP (0.00) (0.36)
Unrealized income from
 hedging transactions 0.13 0.54
Pension costs 0.03 0.01
Amortization of goodwill 0.04 0.04
Deferred taxes (0.02) (0.06)
Stock based compensation expense 0.01 -
Net income per ADS - Irish GAAP 0.19 0.17
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