Ter Beke : Consolidated balance sheet and income statement 2016

• Ter Beke group realises the best result ever:

  • Net result growth of 22.0%.

  • The consolidated turnover increased by EUR 22.2 million (+5.6%) to EUR 418.6 million;

  • REBITDA amounts to EUR 38.5 million in 2016 compared to EUR 35.8 million in 2015 (+7,5%).

  • EUR 0.7 million non-recurring expenses were incurred in 2016. This concerns redundancy payments amounting to EUR 1.3 million and a benefit of EUR 0.6 million for the sale of BINET SA.

  • As a result of the above:

    • EBITDA amounts to EUR 37.7 million compared to EUR 34.3 million in 2015 (+10.1%)

    • EBIT amounts to EUR 18.1 million compared to EUR 15.8 million in 2015 (+14.9%)

    • the result after taxes amounts to EUR 12.6 million compared to EUR 10.3 million in 2015 (+22.0%)

    • net cash flow amounts to EUR 32.0 million compared to EUR 29.3 million in

      2015 (+9.6%)

  • Net financial debt is reduced by nearly 50% in 2016

• Processed Meats Division:

  • The turnover in this division increased by 5.1%.

  • Additional investments in the growth strategy in the Dutch market are reaping the initial rewards and more than compensate for the loss of a volume contract in the English market half way through 2016 and the adverse effects of the drop in value of the British pound.

  • Multilayer Packaging concept launched for meat products.

  • Continued focus on the profitability of the product range and extensive cost control.

• Ready Meals Division:

  • The turnover in this division increased by 7.1% thanks to the launch of new products and concepts.

  • Continued focus on the profitability of the product range and extensive cost control.

  • Successful repackaging of the Come a casa®product range

• Proposal to pay a gross dividend of 3.50 EUR per share over 2016.

1. The consolidated income statement and balance sheet can be found at the end of this press release

2. EBITDA = Operating result + depreciation + impairments + changes in provisions

3. REBIT = EBIT corrected for non recurring operating resul ts

4. Net cashflow = Result after tax before share in the result of enterprises accounted for using the equity method + depreciation + impairments + changes in provisions

5. Net financial debt = interest bearing liabilities - interest bearing receivables, cash and cash equivalents

6. Gearing ratio = Net financial debt / Equity

Turnover

The total Group turnover increased by EUR 22.2 million +(5.6%) from EUR 396.3 million to EUR 418.6 million

The turnover of the ready meals division increased by EUR 8.1 million compared to 2015 (+7.1%) thanks to the launch of new products and concepts. For example, in September 2016 the Group

launched a new range of ultra-fresh lasagne and pasta meals under the brand name Come a casa®Delicious. Growth was also realized in the Spanish, French and Dutch retail channel.

The turnover of the Processed Meats Division increased by EUR 14.1 million (+5.1%). This increase is mainly due to considerable growth in the Netherlands, as a result of strategic investments in this market made by the Group. The Sharing Tapas concept was successfully launched in the Dutch retail channel. The growth in the Netherlands compensates amply the loss of a volume contract in the English market half way through 2016 and the negative effect of the decrease in value of the British pound on turnover. In addition, the launch in Belgium of the Multilayer Packaging concept for meat products contributed to the increase in turnover of the division.

REBITDA, EBITDA, REBIT and Operating result (EBIT)

The REBITDA rose by EUR 2.7 million (+7.5%) from EUR 35.8 million in 2015 to EUR 38.5 million in 2016.

This is both a consequence of the increased turnover in the second half of the year as well as the continued focus on the profitability of the product range and extensive cost control in both divisions.

However, the cost control measures are not preventing the Group from working on various developments for the future.

For example, in September 2016 the Group launched a completely new range of ultra-fresh lasagne and pasta meals under the brand name Come a casa®Delicious for which a major promotional campaign was established.

The Group also invested in two production lines for launching its Multilayer Packaging concept for meat products, which was extremely well received.

In 2016, the Group also successfully launched products in its primary meat products categories (salami, poultry and cooked ham) and in the first half of the year, also invested in restyling the packaging of its ready meals range which is marketed under the brand name Come a casa®. For the development of private label products, we continuously work together with our customers on the desired improvement and innovations in our product range.

Additional investments in efficiency improvements in the factories and the investment in ERP software have allowed us to optimize our business processes.

In 2016, redundancy payments decreased by EUR 0.2 million compared to 2015. In addition, a EUR 0.6 million non recurring result was booked on the sale of the company Binet SA.

This caused the EBITDA to increase by EUR 3.5 million (+10.1%), from EUR 34.3 million in 2015 to EUR 37.7 million in 2016.

Depreciation costs and impairments decrease by EUR 0.4 million and depreciations, write-offs and provisions increase by EUR 1.6 million compared to 2015, mainly due to the provision that was set up for the CEO long term remuneration.

As announced over the last years, this remuneration is formed by a component for exceptional growth in shareholder value achieved by the end of the CEO's mandate in 2018. Based on the current results, a provision of EUR 2.2 million was set up in this respect (EUR 0.6 million in 2015).

Hence, the EBIT increased by EUR 2.4 million (+14.9%), from EUR 15.8 million in 2015 to EUR 18.2 million in 2016.

In 2015, an impairment of EUR 1.3 million was booked on the fixed assets of BINET SA. This explains, along with the other non-recurring items mentioned above, the REBIT increase by 1.7%, from EUR 18.6 million in 2015 to EUR 18.9 million in 2016.

Net financing costs

In 2016, the net-financing costs were EUR 0.8 million lower than in 2015, mainly due to the results on the financial hedging on the British pound.