Groupe SEB: First-Half 2008: Very Strong Performance

Solid Growth and Sharply Improved Profitability
ECULLY, France--(Business Wire)--
Regulatory News:

Groupe SEB (Paris:SK) (ISIN:FR0000121709):

-- EUR 1,417 million in revenue; up 15%, of which 6.8% organic

-- Very strong improvement in operating margin to EUR
117 million; up 49%, or 33% excluding Supor

-- A significant contribution from Supor: EUR 143 million in
revenue and EUR 13 million in operating margin

-- Operating profit and net profit up more than 80%

-- Solid financial position

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CONSOLIDATED FINANCIAL RESULTS
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EUR millions H1 2007 H1 2008 % change
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Revenue 1,232 1,417 +15%
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Operating margin 78 117 +49%
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as a % of revenue 6.3 8.2
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Operating profit 52 94 +82%
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Profit attributable to equity holders of the
parent 28 52 +85%
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Diluted earnings per share (in EUR ) 0.58 1.08 +86%
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In commenting on the first-half 2008 results, Thierry de La Tour
d'Artaise, Chairman and Chief Executive Officer of Groupe SEB, said:

"In an environment that deteriorated as from the second quarter in
West European markets, Groupe SEB enjoyed a very good first half, in
line with last year's results and shaped by solid growth, improved
profitability and a healthy financial position.

Moreover, the integration of Supor is well underway and projects
are moving forward as planned.

Mature markets should not show a positive change in the months
ahead, but backed by our product dynamic, our international presence
and our disciplined cost management, we remain confident in our
ability to meet our 2008 targets of revenue growth and operating
margin improvement."

Solid revenue growth

Consolidated revenue for first-half 2008 rose 15% to EUR
1,417 million including a EUR 143 million contribution from China's
Supor, which has been fully consolidated since 1 January 2008. These
sales also take into account a negative EUR 41 million currency effect
(compared with a negative EUR 23 million in first-half 2007) which was
due to the decline against the euro of a number of the Group's most
important currencies, especially the dollar. At constant exchange
rates and scope of consolidation, growth came to 6.8%, This solid
organic growth reflected sustained business during the first half,
combining another increase in sales volumes, a further improvement in
the product mix and firm prices. It was led by a large number of
products and in particular by the gradual international rollout of
such 2007 flagship products as Actifry, Dolce Gusto, Silence Force,
bread makers and Quick'N Hot. Compared with 2007, performance was more
varied geographically, with a second-quarter slowdown in Western
European countries but a return to growth in the United States and
sustained rapid development in emerging markets.

Sharp improvement in operating margin

Operating margin in the first half increased by nearly 50% to EUR
117 million, including a significant EUR 13 million contribution from
recently consolidated Supor. At constant scope of consolidation,
operating margin rose nearly 33% in spite of the increase in costs for
the period due to:

-- Purchases, which were only slightly penalised in the first
half by the rise in raw material prices, with a negative
impact of EUR 5 million related mainly to sourced products.

-- The increase in the advertising budget, as announced
previously, with an additional investment of EUR 13 million to
support our market shares.

-- A nearly EUR 3 million increase in research and development
expenses.

-- A strengthening of strategic marketing resources.

Operating margin was also lifted by a EUR 14 million currency
effect, stemming from the favourable impact of the lower dollar on
purchased inputs. However, the weaker dollar is also weighing on the
competitiveness of the Group's European production plants.

Very robust increase in operating profit and net profit

Operating profit rose by more than 80% to EUR 94 million for the
period. This was after Statutory and discretionary employee profit
shares, as well as after Other operating income and expenses, which
amounted to a net expense of EUR 12 million, compared with a net
expense of EUR 14 million in first-half 2007. Operating profit is also
stated after restructuring costs (for a major streamlining of the UK
supply chain and a sales reorganisation in the United States mainly),
impairment losses on Mirro WearEver, and non-recurring income.

Finance cost and other financial income and expense, net, amounted
to a net expense of EUR 17 million, a very slight increase over
first-half 2007. It reflected the increase in average debt following
the Supor acquisition, which was not recognised in interim 2007
financial statements, as well as the disciplined management of
interest expense, with a decline in the Group's average cost of
borrowings.

Profit attributable to equity holders of the parent increased by
85% to EUR 52 million, from EUR 28 million in first-half 2007. It
included a EUR 6-million contribution from Supor, after minority
interests of EUR 5 million.

A solid balance sheet structure

During the first half, two changes were made in the Group's
holding in Supor. In May, the Group had the opportunity to acquire
minority interests in three major Supor subsidiaries, enabling it to
capture a larger portion of the company's earnings. At the same time,
following a slight dilution due to the exercise of stock options by
Supor management, Groupe SEB's interest in the Chinese company stood
at 51.31% at 30 June.

In 2007, Supor was accounted for by the equity method, with the
shares recognised in "Other investments." Supor's full consolidation
as from 1 January 2008 has led to several major changes in Groupe
SEB's balance sheet.

On the asset side, the most important impact concerns intangibles,
which increased by EUR 363 million, of which EUR 266 million in
goodwill and EUR 75 million in brand value.

On the liabilities side, equity was strengthened by an additional
EUR 109 million in minority interests, to stand at EUR 972 million at
30 June 2008. Net debt amounted to EUR 627 million at 30 June 2008,
compared with proforma debt (including Supor) of EUR 585 million at 1
January 2008. The EUR 42 million increase was due to the acquisition
of minority interests within Supor, SEB share buy-backs, the payment
of the dividend and various outflows for recurring restructuring
programmes. At the same time, Groupe SEB maintained a strict control
of its working capital requirements resulting in a strong improvement
in the ratios during the first half. With gearing of 64%, the Group's
financial position is still healthy and robust.

Outlook for 2008

The more mixed economic environment that characterised the first
half seems likely to persist in the months ahead. The second half is
not expected to see any trend breaks, either in exchange rates, with
the euro probably remaining strong, or in raw material prices, which
should stay high. The consumer environment should also remain varied,
with mature markets experiencing a slowdown and emerging markets, in
which Groupe SEB generates 45% of its revenue, maintaining their rapid
growth.

Backed by its product dynamic, its portfolio of powerful brands
and its extensive international presence, Groupe SEB is well equipped
in this environment to hold its own in Western Europe and the United
States and to drive new gains in fast-growing markets. As a result,
the Group maintains its full-year 2008 objectives for organic growth
in revenue and an improvement in operating margin at constant scope of
consolidation. Supor will make an additional contribution to these
objectives, which will reflect its sustained strong growth momentum.

The world leader in small domestic equipment, Groupe SEB operates
in more than 120 countries with a unique portfolio of top brands
marketed through multi-format retailing. Selling some 170 million
products a year, it deploys a long-term strategy focused on
innovation, international development, competitiveness and service to
clients. Groupe SEB has 19,500 employees worldwide.

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GROUPE SEB
DIRECTION DE LA COMMUNICATION FINANCIÈRE
Chemin du Petit Bois I BP 172 - 69134 ECULLY Cedex France I T.+33 (0)4
72 18 16 40 - Fax +33 (0)4 72 18 15 99
Société par Actions Simplifiée au capital de 806 400 EUR I 016 950 842
R.C.S Lyon I T.V.A FR 94016950842
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Groupe SEB

Copyright Business Wire 2008