Lanitis Bros. seen lifting sales and profits

Lanitis Brothers Pcl (LB) is seen improving sales and profits during the first nine months of the year. The Board will convene on 15 November 2005 to examine its 9M05 results.

According to an investment report issued by Egnatia Financial Services, total revenues in 9M05 are expected to reach CYP 44.7 mln, up by 10.8% primarily driven by revenues from the production and distribution of chilled products (milk and dairy foods). This increase is associated by: higher quantities of raw cow milk apportioned to LB and the recent price hike in the per litter bottle of milk effected during 9M05 compared to the lower prices charged during the comparative 2004 period.

Higher European CSD export sales also contributed positively to LB’s revenue growth.

Regarding profitability, Egnatia anticipate that margins will deteriorate at the Gross profit and EBIT levels amid the larger trade discounts on Coca Cola products offered by LB due to increased competition from parallel imports, substantially higher costs of sales from beer products following the new co-operation agreement with Heineken International B.V. and higher fuel costs.

Bottom line profits will be positively affected by the lower effective taxation rate resulting from the abolition of the additional 5% tax rate on before tax profits above CYP 1 mln which (effective as of the beginning of 2005) and an amount of CYP 371.000 relating to the permanent

impairment in the fair value of investments available for sale during 9M04.

All in all Egnatia anticipate Net Profit to increase by 12.8% YoY to CYP 1.77 mln in 9M05 and Net Profit margin to improve marginally by 10bps to 4.0%.