PRESS RELEASE BERLI JUCKER REPORTS BAHT 170 MILLION IN NET INCOME FOR THE SECOND QUARTER : NET INCOME FOR FIRST HALF RISES 296 PER CENT Berli Jucker Public Company Limited announced its results for the second quarter of the year today: Consolidated net income for second quarter was Baht 170.4 million, continuing the profitable trend of Berli Jucker's core businesses shown in the first quarter of 1999. This compares with a net loss of Baht 25.3 million in the second quarter of 1998, when a substantial provision was made in respect of discontinuing the Group's planned glass bottle manufacturing facility in Vietnam. Consolidated net income for the first half of 1999 increased by 296 per cent to Baht 359.5 million compared with same period last year. Total consolidated sales for the second quarter increased by 5 per cent to Baht 2,736.9 million when compared with the same quarter last year; with sales for the first half standing at Baht 5,475.7 million, an increase of 1 per cent over the first half of 1998. The Group's gross margin rose to 27.6 per cent compared with a margin of 23.1 per cent in the second quarter of 1998, the comparative strengthening of the Thai Baht having positively affected the Group's cost of sales and reduced pressure for local inflationary cost increases. Berli Jucker's President and Chief Executive Officer, Mr. David J. Nicol, commented: "I am pleased to report a solid second quarter performance by Berli Jucker. Sales have increased from the low levels seen in the second quarter of 1998, and with these increases have come improved margins. Our core businesses have all recorded substantial increases in contribution, and our net income has been helped by the absence of foreign exchange volatility and extraordinary charges seen in the second quarter of 1998. Sales of Consumer Products increased by 12 per cent to Baht 805 million for the second quarter of 1999, led by substantial growth in our Parrot brand of Soap and Shampoo; Parrot Soap sales have more than doubled since the first half of 1998 despite significant price competition. Parrot Shampoo and Conditioner, in 4 fragrances, was launched in April and has been well received. Tissue paper sales for the first half of the year have comfortably exceeded the volumes of early 1998, with the Zilk economy brand proving particularly popular. Cellox Paper's new tissue paper machine was commissioned in mid May, and replaces older, less efficient machinery, which will permit the manufacture of bulk tissue paper rolls for the export and private label markets. Snack foods and confectionery sales have been encouraging, with the sales of our Tasto potato chips proving particularly strong. New products will be launched in both the extruded snack and potato chip lines later this year. Confectionery sales have benefited from the introduction of new Trebor and Sugus flavours, together with packaging redesigns. The net income contribution of this group rose substantially as a result of higher sales and improved margins. Berli Jucker has recently announced a broad restructuring of its Consumer Products business, which encompasses centralisation of product development efforts, and a clear delineation between Berli Jucker branded and third party products; this will result in improved service levels for both customers and the companies for whom we distribute, will lower operating costs, and will improve brand identification. The Packaging group, led by Thai Glass Industries, achieved a 3 per cent sales growth for the second quarter of this year to Baht 1,013 million. Net income contribution rose substantially due to a combination of planned productivity improvements, enhanced margin due to product mix, and our increased shareholding in that company which now stands at 98 per cent, compared with 66 per cent in early 1998. Over 132 million beer bottles were produced during the second quarter of this year, a 22 per cent increase from the volumes produced in the same period during 1998. Demand for food containers has remained strong during the second quarter, and there was a marked increase in demand for energy drink bottles due to greater promotional activities by the drink manufacturers and their resumption of exports. Berli Prospack, our manufacturer of rigid plastic containers, has doubled its sales for the second quarter of this year compared with the early part of 1998 but margins continue to be under pressure. The Technical Products group saw a slight decline of 2 per cent in sales to Baht 801 million for the second quarter. Whilst Thai Klinipro, our medical gown manufacturing subsidiary which exports to Europe, had sales slightly exceeding those of same period in 1998, other components within the group saw small sales decreases. Depressed sales of Photographic products, which are mainly aimed at the retail sector, were partially offset by improving sales of Imaging products, particularly in sales to areas outside Bangkok. Chemical product sales fell slightly from the comparative period in 1998, as the somewhat cooler weather led to decreased demand for refrigerant products. Sales of Medical products for the second quarter were only just below those for the same period in 1998, but gross margins were encouraging. The net income contribution of the Technical Products group rose substantially as a result of a larger proportion of sales being in the higher margin technical equipment sector, and by virtue of a successful effort by the group to reduce working capital costs. Engineering group sales for the second quarter were Baht 116 million, a 2 per cent increase from the comparative period in 1998. Whilst the Engineering Division of Berli Jucker continued to be profitable, there was some slippage in revenues due to delayed project billings. Thai Scandic Steel, the Group's manufacturer of galvanised towers for use in electricity and telecommunication sectors, has a number of projects on hand but production volumes are still at a low level. The Group's Engineering businesses were unable to contribute to income during the quarter, but recorded a substantial decrease from the level of losses seen in the second quarter of 1998, primarily as a result of the recent stability of the Baht. Berli Jucker's performance for the second quarter of this year was significantly stronger than for the same period in 1998, even after discounting the foreign exchange losses and extraordinary item charged in that earlier period. Additionally, as the Group continues to generate positive cash flows to add to the already healthy cash position, our net debt and attendant interest burden decreases. The Group's net debt represented only 19 per cent of shareholders' equity at the end of June; a positive factor in pursuing the Group's acquisition agenda." Mr. Nicol went on to comment on Berli Jucker's prospects for the second half of 1999: "The second quarter of 1999 has been very encouraging; Berli Jucker's balance sheet is strong, sales are steadily increasing, and gross margins are improving. With the new focus in our Consumer Products group, and the continued profitability of Thai Glass Industries, the second half of this year should also be positive." August 17th, 1999 For further information please contact: David J. Nicol: Tel 367 1024 Blair Sinton: Tel 367 1026 President and Chief Executive Officer Chief Financial Officer E-mail: davidnicol@berlijucker.co.th E-mail: blair@berlijucker.co.th