2008 First Half results

⁽¹⁾ EBIT before SG&A (G&A, other operating income/expenses and selling expenses)

CONSOLIDATED RESULTS FOR THE FIRST HALF OF 2008
In 2008 we introduced a new P&L format. Referring to the line selling and distribution expenses, according to the new format, distribution expenses are included in the COGS line, while selling expenses are classified in the SG&A line, together with G&A and other operating income / expenses.

In the first half of 2008, Group sales totalled € 431.2 million, a decrease of 2.1% (+0.3% at constant exchange rates).

The overall change in consolidated sales resulted from an organic growth of 3.0%, a negative exchange rate effect of 2.5% and a negative perimeter effect of 2.7%. The latter was due to the announced termination of tequila 1800 distribution contract in US, which was partially offset by Cabo Wabo and X-Rated (whose sales started on 1 August 2007), as well as Bowmore and Flor de Caña.

Contribution after A&P (gross margin after distribution costs and A&P) increased by 1.6% to € 162.2 million (+4.4% at constant exchange rates), or 37.6% of sales. Organic growth accounted for 5.3% and external growth was a negative for 0.8%, lastly exchange rate effects negatively contributed for 2.8%.

EBITDA before one-off’s decreased by 2.0% (+1.0% at constant exchange rates) to € 100.4 million, or 23.3% of sales.

EBITDA rose by 1.2% (+4.2% at constant exchange rates) to € 102.0 million, or 23.7% of sales.

EBIT before one-off’s went down by 2.1% (+1.1% at constant exchange rates) to € 90.8 million, or 21.1% of sales. Organic growth accounted for 4.1% EBIT increased by 1.5% (+4.6% at constant exchange rates) to € 92.5 million, or 21.4% of sales.
Organic growth accounted for 7.7%

Profit before tax and minority interests was € 83.7 million, an increase of 1.3%.

The Group net profit was € 59.8 million, with a progression of 5.1% (+7.4% at constant exchange rates).

As of 30 June 2008, after payments of € 31.8 million as dividends and US$ 80.8 million (approximately € 57 million) for 80% of Cabo Wabo, net debt stood at € 354.8 million (€ 288.1 million as of 31 December 2007). The net debt includes €18.4 million estimated debt for possible exercise of put option on remaining 20% minority stake in Cabo Wabo.

CONSOLIDATED SALES FOR THE FIRST HALF OF 2008
The spirits segment (70.6% of total sales) recorded a decrease of 4.5%, the combined result of an organic growth of 2.2%, a negative exchange rate effect of 3.1% and a negative perimeter effect of 3.7%.

The Campari brand posted a growth of 4.8% at constant exchange rates (4.3% at actual exchange rates). SKYY sales grew by 8.5% at constant exchange rates (-4.4% at actual exchange rates).
Regarding the other main brands, CampariSoda finished the first half with a slight decrease of 1.1%; Aperol confirmed the positive trend and recorded a strong growth of +12.0% at constant exchange rates. The Brazilian brands (-15.8% at constant exchange rates) and Cynar (-8.5% at constant exchange rates) registered a decrease, a short term effect due to a tax change in Sao Paulo state; while Glen Grant ended up the first half almost in line with last year (-0.6% at constant exchange rates)
Regarding agency brands, Jack Daniel’s performed well (+6.5% at constant exchange rates).

The wines segment, which contributed 13.9% of total sales, registered a growth of 5.6%, due to the combination of organic growth of 6.2% and a negative exchange rate effect of 0.6%. The segment’s positive performance was driven by Cinzano vermouth (+5.6% at constant exchange rates) and by Cinzano sparkling wines (+4.8% at constant exchange rates). The still wines segment also benefited from the positive performance of Sella & Mosca (+5.3%).

Sales of soft drinks (13.5% of total sales), which are generated almost entirely by the Italian market, recorded an organic growth of 1.8%, driven by Crodino (+6.5%), while the Lemonsoda range registered a decrease (-1.6%) due to poor weather condition in Q2.

Looking at results by region, sales on the Italian market (45.9% of total Group sales) recorded an increase of 2.8%, thanks to good organic growth. Sales in Europe (21.0% of consolidated sales) grew by 4.8%, driven by the organic sales growth of 5.6%, thanks to positive performances from key markets; the exchange rate effect was negative at 0.8%. In the Americas (28.2% of total sales), the US market registered an organic growth of 1.3%, a negative exchange rate effect of 9.6% and a negative perimeter effect of 11.6%. In Brazil, sales registered an organic decrease of 11.7%. The exchange rate effect was positive at 4.2%. Sales in the rest of the world (including duty free sales), which accounted for 4.8% of total sales, grew by 14.9% overall, driven by an organic growth of 16.8%.

CONFERENCE CALL

Please note that at 15.00 (CET) today, Friday 8 August 2008, Campari’s management will hold a conference call to present the Group’s 2008 first half results to analysts, investors and media. To participate, please dial one of the following numbers:

• from Italy: 800 785 163 (toll free number)
• from abroad: +39 02 6968 2741
  

A recording of the conference call will be available from 22.00 (CET) on Friday 8 August until 22.00 (CET) on Friday 15 August 2008.

To hear it, please call +44 20 713 69233 (access code: 99262438#).

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The Manager in charge of preparing Davide Campari-Milano S.p.A.’s financial reports, Paolo Marchesini, certifies - pursuant to article 154 bis, paragraph 2 of the Consolidated Law on Financial intermediation (Legislative Decree 58/1998) - that the accounting disclosures in this statement correspond to the accounting documents, ledgers and entries.