Campari Group

It should be stressed that if sales and main profitability indicators were considered before exchange rates impact (i.e. using average exchange rates for the first quarter of 2003), they would show double-digit growth versus the previous year.

2004 CONSOLIDATED FIRST-QUARTER RESULTS
In the first three months of the year, Group sales totalled € 151.3 million, an increase of 11.9% (+15.5% at constant exchange rates). Organic growth was 5.4%, while exchange rate movements had a negative effect of 3.6%, mainly because of the fall in value of the US dollar. External growth of 10.1% was due almost entirely to the newly-acquired Barbero 1891 S.p.A.
Trading profit jumped by 16.6% to € 43.5 million, or 28.8% of sales.

EBITDA rose by 9.7% (+13.2% at constant exchange rates) to € 34.8 million, or 23% of sales.
EBITA increased by 7.7% (+11.5% at constant exchange rates) to € 30.4 million, or 20.1% of sales.
EBIT went up by 1.3% (+6.2% at constant exchange rates) to € 21.6 million, or 14.3% of sales. The lower growth rate was due to higher goodwill amortisation charges following the consolidation of Barbero 1891 S.p.A.

Profit before tax and minority interests was € 20.1 million, up 12.1% (+17.6% at constant exchange rates).
Group’s profit before taxes (i.e. profit before tax and after minority interests) was € 18.6 million, up 21.6% (+26.4% at constant exchange rates).
At 31 March 2004, net debt stood at € 271.3 million (€ 298 million at 31 December 2003).

2004 FIRST QUARTER SALES
The spirits segment, which accounted for 64.5% of total sales, recorded a positive performance of 10.6%, determined by organic growth of 3.3%, external growth of 12.6% and a negative exchange rate effect of 5.3%. The Campari brand posted growth of 9% at constant exchange rates (+6.6% at actual exchange rates). Positive performances in Brazil, Japan and other major European markets more than offset the contraction of sales in Italy (which was expected after many distributors had increased their stocks in December 2003 in view of an increase in excise duties on alcohol, which became effective on 1 January 2004) and in Germany (due to a different phasing in advertising and promotion activities). Sales of SKYY Vodka, including flavours, fell by 5.3% in local currency terms. This result was generated entirely on the US market, as a result of too optimistic expectations of wholesalers on consumption levels during the Christmas season. Regarding the other main brands, spirits also benefited from a good performance from the Brazilian brands (+11.4% at constant exchange rates), Cynar (+4% at constant exchange rates), tequila 1800 (+22% at constant exchange rates) and Scotch whisky (+34.9% at constant exchange rates). However, sales of CampariSoda, Jaegermeister and Ouzo 12 declined by 2.4%, 4.6% and 2.7% respectively. External growth, entirely attributable to Barbero 1891 S.p.A., benefited from the positive contribution of all brands acquired, especially Aperol, which recorded volume growth of 26.8% compared to the first quarter of last year.
The wines segment (13.2% of total sales) posted growth of 29.5%. Organic growth (+20.5%) was helped by a jump in sales of Cinzano sparkling wines (+18.4% at constant exchange rates) due to a good performance on the Italian and German markets, and of Cinzano vermouth (+18.7% at constant exchange rates), following growth on its most important European markets, including Russia. Wines were also boosted by a good performance from Sella & Mosca (+5.3%) and Riccadonna. External growth (+10.6%) was almost entirely due to Barbero 1891 S.p.A., particularly the Mondoro and Enrico Serafino brands.
Sales of soft drinks accounted for 20.9% of the total, and were generated almost entirely on the Italian market. This segment posted growth of 5.5% thanks to a good performance from all brands, especially Crodino (+7.8%), Lemonsoda, Oransoda and Pelmosoda (+2.9%) and Lipton Ice Tea (+4.5%).

By region, Italy accounted for 57% of 2004 first quarter Group sales owing to the significant contribution of Barbero 1891 S.p.A. (+15.4%), whose sales are concentrated on the Italian market. Sales in Europe (18.6% of the total) as a whole were also boosted significantly by external growth (+9%), again mostly attributable to Barbero 1891 S.p.A. Organic growth was however slightly negative (-0.5%); this was due entirely to the performance of Campari Mixx on European markets. As announced previously, the distribution of Campari Mixx was terminated in Germany and Switzerland because of tax hikes which hit ready-to-drinks. In the Americas, which account for 21.9% of total sales, the US market posted growth of 6.5% at constant exchange rates, which was completely wiped out by negative exchange rate movements (-15.1%), while sales in Brazil grew by 7.7% in local currency terms. Sales here also benefited from a positive exchange rate effect (+3.8%).

BOARD OF DIRECTORS
The Board of Directors (appointed by the Shareholders’ meeting of 29 April) has appointed Enzo Visone as Chief Executive Officer. Luca Garavoglia was appointed as Chairman directly by the Shareholders’ meeting.

CONFERENCE CALL
Please note that at 17.00 today, Monday 10 May 2004, Campari’s management will hold a conference call to present the Group’s 2004 first quarter results to analysts, investors and journalists. To participate, please dial one of the following numbers:

• from Italy: 800 914 576 (toll free number)
• from abroad: +390237008208

The presentation can be downloaded before the conference call from the Investor Relations page of Campari’s website, at www.campari.com/investors.