Acquisition represents expansion into rapidly growing chilled desserts sector


Acquisition to be EBITDA and earnings positive in Q1 of Fiscal 2001/2002


Hibernia Foods plc (Nasdaq: HIBNY; “Hibernia”) today announced that it has completed its fourth UK acquisition with the acquisition of the trade and certain assets relating to the chilled desserts business of La Boheme Limited, located in Birmingham, UK, effective 1 April 2001. Consideration, paid in cash, amounted to Stg(pound)2.5m (approximately $3.6m). The transaction was completed by Hibernia Chilled Foods Limited, a wholly-owned UK subsidiary of Hibernia.

Commenting on the acquisition, Hibernia Chairman and Chief Executive Officer, Oliver Murphy, stated: “We are delighted to have completed this strategically important acquisition. The acquisition represents an expansion into a fast growing sector of the retail food market and enables us to leverage off our existing position as a major supplier to the UK retail confectionery market. La Boheme supplies a range of premium quality chilled desserts to Tesco PLC, the largest food retailer in the UK and adds to our considerable, and growing, revenue base with this customer. At just under 0.25 times sales and less than 3 times trailing EBITDA, the consideration paid represents excellent value to our shareholders in the context of a growing and profitable business with a premium customer base.”

“We recognise the enormous opportunity which exists in the chilled desserts sector, where our Entenmann’s branded chilled desserts range is already the brand leader and premium quality range in the UK. The sector is currently valued at approximately Stg(pound)250m (approximately $365m), and has been experiencing double digit market growth, and this acquisition, combined with our Entenmann’s range of chilled desserts, will provide us with an ideal platform from which to drive revenues and profitability in the exciting convenience foods sector.”

La Boheme’s chilled desserts business reported revenues of Stg(pound)10.1m (approximately $14.6m) for the year ended September 30th 2000. The chilled desserts business is profitable and Hibernia anticipates that this profitability will be significantly enhanced through economies of scale synergies, as well as anticipated revenue growth.

The chilled desserts business supplies Tesco PLC with premium quality hand finished chilled patisserie products such as choux buns, and tartes aux fruits. Hibernia already supplies Tesco PLC with private label frozen desserts, frozen ready-meals, and Entenmann’s branded sweet baked goods and chilled desserts. Tesco PLC is the largest food retailer in the UK with annual revenues of approximately Stg(pound)19bn (approximately $27.5bn).

As part of the transaction, Hibernia is also acquiring La Boheme’s frozen desserts business, which supplies the foodservice market, and reported revenues of Stg(pound)2.4m (approximately $3.5m) for the year ended September 30th, 2000. The total revenues being acquired accordingly amount to Stg(pound)12.5m ($18.1m).

Hibernia Foods plc is a leading manufacturer of branded cakes and branded ready-meals, and private-label frozen and chilled desserts, frozen ready-meals and savory products, headquartered in Dublin, Ireland, with significant manufacturing facilities in the North East, Midlands and South West of England. It is the exclusive European license holder for Entenmann’s branded sweet-baked cakes throughout all of geographical Europe, representing 52 countries and a population of over 700 million people.

This report contains forward-looking statements based upon certain assumptions by management, some of which may not materialize, and unanticipated events may occur which could effect the business of Hibernia and the markets for its products. Forward-looking statements contained herein involve a number of risk and uncertainties including, but not limited to, economic, competitive, governmental and technological factors.