LIKE-FOR-LIKE NET PROFIT GROWTH OF 17.6% TO €151.6 MILLION

Ebro posted a net profit on continuing operations of €151.6 million in 2011, up 17.6% on 2010. The net profit reported in 2010 is not comparable with that of 2011 as it included the proceeds from the sale of the dairy business.
Net turnover rose 7% year on year to €1,804 million.
The EBITDA or gross operating profit amounted to €273 million, with a year-on-year growth of 2%. Stripping out the exchange rate effect, the growth would have been 5%, reaching €280 million.
Ebro’s net debt was €390 million at year end, including payment for the purchase of the SOS rice business (€205m), payment of an extraordinary dividend of 0.15 euro per share (€23m), the purchase of Deoleo shares (€50m), the purchase of treasury stock to the tune of €54.5m and purchase of the No Yolks and Wacky Mac brands for €38m.
A highly satisfactory year in a complicated environment
Ebro has proved once again the solvency and strength of its business model, coping admirably with the onslaught of external factors such as exchange rate fluctuations and soaring raw material prices, which increased costs by around €100 million.
2011 was also a year of major investments, in both optimising our production capacity and developing new products.
Against a backdrop of low consumption, the rice and pasta divisions have maintained their market shares and in some segments they have even managed to increase them, through a constant policy of innovation, launching new products, and heavy investment -topping €69 million- in advertising. The company also embarked on several organic growth projects during the year, opening up new market niches in the segments of functional, vegetable and quick-cooking pastas and frozen rice in the USA, where the company has already placed these products with numerous retailers, including 3,000 Wal-Mart.
All this, together with a general trend of falling prices in raw materials for 2012 and its comfortable financial position, put the company in an optimum situation to continue growing in the future. From the point of view of inorganic growth, there are no signs at present of any major operations on the market that could make a substantial difference to Ebro’s current structure, and within the realms of organic growth, the company is considering the possibility of expanding into other geographical areas.
Core Businesses
Rice
The rice division, bolstered largely by the excellent performance of the European subsidiary Herba, has achieved a considerable improvement during the year in terms of both sales and EBITDA. Herba has recorded a growth of over 15% in EBITDA, through its efficient management of the business and raw material supplies and its commercial policies.
Although it has encountered certain adverse factors during the year such as the delayed start-up of certain production lines at the Memphis plant and the poor quality of the previous rice harvest, the development of the North American business can also be considered positive, maintaining its market shares and even increasing its share in segments with a higher value added, such as microwave and aromatic rice.
The division turnover rose by 13.5% to €920.7 million, with EBITDA of €136 million, up 10% on 2010.
Pasta
The evolution of this division in 2011 was marked by the hike in durum wheat prices, taking the annual average to 340 €/tonne with sharp fluctuations during the year, the restructuring undertaken in Germany and heavy investment in promotions in the United States to counter the aggressive price policies of our rivals on that market.
Panzani achieved a satisfactory business development during the year, with a 10% growth in sales and standing up well to competition thanks to the success of its product portfolio.
The division posted an EBITDA of €144 million and a turnover of €928 million, up 2%.