Parmalat FY sales 3.854 bln eur, EBITDA 354 mln eur, below forecasts UPDATE

Parmalat FY sales 3.854 bln eur, EBITDA 354 mln eur, below forecasts UPDATE

	Published : Fri, 02 Feb 2007 18:39 By : Agencies Print this Story

(updates with details from conference call, 2007 forecasts)

MILAN (AFX) - Parmalat SpA said its full year sales increased to 3.854 bln eur from 3.681 bln in 2005 and EBITDA rose to 354 mln eur from a pro forma 278 mln eur, below analysts' forecasts.

The food and dairy company attributed the improvement to a more favourable sales mix, industrial and operational efficiency measures, new sales initiatives and a favourable exchange rate.

Analysts were expecting sales in the range of 3.982-4.174 bln eur and EBITDA in the 358-374 mln eur range.

In a conference call on the 2007 targets, CEO Enrico Bondi said there was a 'high probability' that Parmalat would not reach its 2007 targets, 'especially for sales,' adding that 454 mln eur is still the EBITDA target, 'but we may have to postpone it.'

He said the company would review the situation in the next few weeks.

Parmalat had been targeting a 2007 EBITDA of 454 mln eur, and sales of 3.895 bln, implying an 11.7 pct margin.

Sales in Canada, the largest unit, rose 3.3 pct; in Australia, the third largest unit, they rose 1.5 pct and in Africa, the third largest region they increased 10 pct.

In Italy, the second largest unit, they dropped 2.1 pct and in Spain, the fifth largest unit, they slumped 8.5 pct.

'In Spain we still have a problem. We are trying to have a better 2007 but we know the results for 2007 will be very different from the ones we put in the plans,' the group said.

The company reduced its debt to 151.7 mln eur from 369.3 mln eur a year earlier excluding the transaction under which BNP Paribas unit Banca Nazionale del Lavoro agreed to pay Parmalat 112 mln eur in claw-back claims and damages.

The settlement of the deal with BNP took place on Jan 5, Parmalat said.

Parmalat said that as of 2007 it will be a 'liquid company' because in addition to the BNL settlement, it will get another 15 mln eur tranche of a settlement from Banca Popolare Italiana by March, which will bring the net debt down to 24.7 mln eur.

Late in 2007, the recent settlement with audit firm Deloitte & Touche and Banca Popolare di Milano with give more liquidity to the group, Parmalat said.

The company said that in 2006, it succeeded in rationalising overhead costs, reducing the number of companies in the group to 131 from 171 in 2005, and is targeting cutting them further to around 50 by end 2007.

In a conference call, Parmalat said the capex in 2006 totaled some 90-95 mln eur. It could increase this figure in the future 'if there are the opportunities', as cash is coming in from several sources, not only from operations.

Parmalat specified that Italy continues to generate cash and in addition, there are one-off items and there is cash coming in from litigation settlements.

yael.schrage@thomson.com

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