Greencore Group PLC Preliminary Statement of Results for the Year Ended September 28, 2007

DUBLIN, Ireland, Nov. 27 /PRNewswire/ -- Greencore Group PLC ("Greencore" or the "Group"), one of Europe's Leading Convenience Food and Malt Producers, Today Issues the Following Preliminary Statement of Results for the Year Ended September 28, 2007.

HIGHLIGHTS -- Excellent performance across the Group's continuing portfolio -- Group operating profit (pre-exceptionals) up 22% to EUR 91.0m -- Profit before tax (pre-exceptionals) up 32% to EUR 75.1m -- Adjusted EPS(1) from continuing operations up 50% to 29.8 cent (total adjusted EPS(1) was 30.6 cent which compares with an FY06 level, including discontinued sugar operations, of 31.1 cent) -- Difficult second half of year impacting Convenience Foods performance but conditions for recovery in place: -- Turnover growth of 4% to EUR 933.1m with a 1% decline in the second half of year -- Operating profit decline of 7% to EUR 64.4m with a 16% decline in the second half of year -- Strong market share positions maintained as platform for recovery in FY08 -- Strong performance in Ingredients & Related Property division: -- Operating profits of EUR 26.6m, an increase of 372% -- All ingredient businesses delivering strong turnover and profit growth -- Positive momentum in the management of each of the Group's four significant related property assets -- Net finance costs reduced by 8% and effective tax rate reduced to 18% -- Net exceptional profit of EUR 48.2m of which the sale of the Group's 50% interest in Odlums was the largest contributor -- Comparable net debt of EUR 320.5m, a reduction of EUR 64.9m since September 2006 -- Recommended increase in full year dividend of 5%; final dividend at 8.21 cent up from 7.58 cent in FY06 -- Positive outlook for FY08 and beyond

Commenting on the results, David Dilger, Group chief executive, said:

"Greencore has made great progress in 2007 with significant growth in operating profits, profit before tax and continuing EPS. Convenience Foods is central to Group strategy and performance, and while we had a tough second half this year, due principally to external factors, our market positions and executional skills remain very strong. In common with the rest of the industry, we are working hard to offset the impact of high levels of raw material inflation. Progress in achieving price increases is encouraging.

"Our Malt business, in which we are a European leader, has had an excellent year, with a strong recovery in profits bringing the business back towards more acceptable levels of return. We have also made considerable progress in adding value to our Related Property sites in Mallow, Carlow and Athy in Ireland, and at Littlehampton in West Sussex, UK.

"With a strong Convenience Foods business, a recovering Malt franchise, nearly 1,000 acres of development property and a stronger balance sheet, the Group is confident in its ability to deliver substantial value to shareholders in the coming years. This confidence is reflected in the Board's decision to recommend its first dividend increase since 2000."

(1) Before exceptional items, inter-company foreign exchange gains/losses and the movement in the fair value of all derivative financial instruments and related debt adjustments. For further information, please contact: David Dilger, Group Chief Executive +353 (0)1 605 1045 Patrick Coveney, Chief Financial Officer +353 (0)1 605 1018 Eoin Tonge, Group Capital Markets Director +353 (0)1 605 1036 Billy Murphy or Anne-Marie Curran, Drury Communications +353 (0)1 260 5000 Rory Godson, Powerscourt +44 (0)207 250 1446 About Greencore -- Greencore is one of Europe's leading producers of convenience foods with its principal operations in the UK. -- Greencore is one of Europe's largest producers of malt for the brewing and distilling industries with operations in Ireland, the UK and Belgium. -- Greencore is Europe's largest sandwich manufacturer, producing more than 200 million sandwiches per annum. -- Greencore is the UK's largest Christmas cake manufacturer with a 33% market share. -- Greencore is the UK's largest producer of customer branded mineral water producing 200 million units per annum. -- Greencore retains nearly 1,000 acres of property assets with the potential for development in Ireland and the UK.

SUMMARY

In the first year following its exit from sugar processing activities, Greencore delivered an adjusted EPS level of 30.6 cent - a level that almost matched the FY06 adjusted EPS level of 31.1 cent, a figure that reflected 9.9 cent of discontinued 'sugar' EPS. On a continuing EPS basis, the Group delivered a 50% increase year-on-year (from 19.9 cent to 29.8 cent). This strong Group financial performance was driven by excellent recovery in the Ingredients & Related Property division, good Convenience Foods performance in the first half of the year, a reduced finance charge and a lower effective tax rate.

Although the Convenience Foods division performed well in the first half of the year with revenue and operating profits up 8% and 5% respectively, performance in the critical second half period was disappointing. Profit declined 16% in this period primarily due to the impact of unseasonal summer weather and strong raw material cost inflation in the final quarter. On a full year basis, turnover rose 4% to EUR 933.1m, and operating profit fell 7% to EUR 64.4m, reflecting a fall in operating margin from 7.7% to 6.9%. Notwithstanding the decline in operating profits relating largely to external factors, the year saw continued momentum against our key strategic and operational objectives:

-- Leadership of growing concentrated product categories: No. 1 or No. 2 category share positions maintained(2). Despite difficult summer trading conditions, critically, our 'summer-weighted' categories (Sandwiches, Water and Quiche) maintained or grew market share during the year. -- Broad channel exposure: Sales to non-multiple customers in FY07 retained at one third of divisional turnover. -- An increased commitment to branded products: Sales of 'branded' products grew by 22% and account for 13% of divisional turnover. -- Relentless focus on Total Lowest Cost ("TLC"): TLC initiatives drove operational cost reduction of more than 2% of sales in FY07. -- Aggressive product development: More than 40% of our FY07 product range is less than one year old. -- Well-invested food facilities delivering excellent operational performance: Customer service levels averaged 99% in FY07.

The Ingredients & Related Property division made considerable progress in FY07, delivering operating profits from continuing operations of EUR 26.6m, an increase of 372% from the FY06 level of EUR 5.6m. Turnover from continuing operations rose 21% to EUR 334.0m.

The key driver was the strong recovery of our Malt business. Global malt markets now have a better balance between demand and supply, and the UK market in particular has strengthened as a result. Our Malt business has benefited from the restructuring investments made in FY05 and FY06 and from excellent commercial and operational performance in FY07 such that it is now delivering more acceptable returns. Increased profitability from each of the other ingredient businesses and an increased level of disposals of small, surplus properties also contributed to the division's strong operating profit growth in FY07.

The Group's net finance charge for the financial year has been reduced by 8% to EUR 16.7m, impacted by a significant improvement in the net pension credit. In addition, the Group's effective tax rate decreased to 18% (FY06: 22.5% on continuing operations) consistent with the change in the mix of Group profits. The Group's cash position has improved with comparable net debt at year-end totaling EUR 320.5m, a reduction of EUR 64.9m on September 2006.

The Group generated total exceptional gains (net of tax) of EUR 48.2m in the period, reflecting profits on the disposal of several businesses and lower net sugar exit costs than envisaged in our Restructuring Plan.

The Group continues to add value to all four of its large Related Property sites - Mallow, Carlow, Littlehampton and Athy, with the zoning and planning status of each of the sites enhanced during the year.

DIVIDEND

The board of directors is pleased to recommend a final dividend of 8.21 cent. If approved by shareholders, this will result in a total dividend of 13.26 cent for the full year which would represent a 5% increase on last year's level of 12.63 cent. This increase reflects a progression in underlying earnings performance together with the Group's improving capital position. Going forward, the Board expects to grow the dividend further while broadly maintaining dividend cover.

(2) Source: TNS

OUTLOOK

The Board anticipates further progress across each element of the Group's portfolio.

In Convenience Foods, market conditions remain challenging. At this point, inflationary pressures in raw material markets are expected to contribute to an 8% to 10% increase the division's 'cost of goods'. Despite this impact, the Group is confident that the combination of strong operational performance, necessary sales pricing improvements (much of which have already been implemented), tight cost management and the delivery of key new commercial initiatives will enable us to deliver good growth in FY08.

The Group expects the strong performance evident across our Ingredients & Related Property division in FY07 to be sustained into FY08, with the medium term prospects for our Malt business remaining very encouraging. The progress made in respect of our Related Property assets over the last year has served to underpin our confidence regarding the potential to generate significant value from these assets over the coming years.

Overall, the Board believes the Group is well positioned to deliver substantial value to shareholders in FY08 and beyond.

OPERATIONAL REVIEW - Convenience Foods FY07 FY06 Change EUR m EUR m Turnover 933.1 901.4 4% Operating Profit 64.4 69.0 -7%

The Convenience Foods division accounted for more than 70% of Group turnover and operating profits in FY07. Performance in the period was disappointing with turnover growth falling back to 4% (from 8% in FY06) and operating profit declining by 7% (compared to 6% growth in FY06). However, the aggregated full year turnover and profit performance reflects very different results across the two halves of the year.

1. Strong first half performance

In the first half of the year, the division delivered turnover and operating profit growth of 8% and 5% respectively. This performance was characterized by turnover growth at more than twice the underlying market rate (all achieved organically), strong margin performance despite inflationary pressures and the one-off impact of a fire at our largest chilled food facility, and a consistent level of excellent operational performance across all elements of our portfolio.

2. Difficult industry conditions impacted second half

Our Convenience Foods portfolio has always been 'second half weighted' with profits in the second half typically exceeding those in the first half by more than 25%. This weighting is driven more by differences in product mix than by absolute uplifts in divisional turnover. In FY07, this anticipated second half profit uplift did not materialize. Turnover declined by 1% on H2 FY06 and by 5% on H1 FY07. Although second half operating margins (at 7.2%) increased modestly on the first half level (6.7%), they fell well short of the level earned in H2 FY06 (8.4%). The sales and margin impacts reduced second half operating profits by 16% on H2 FY06 and were driven by:

-- Poor summer trading Unseasonal weather conditions led to weaker trading in our key 'summer- weighted categories' such as Sandwiches, Mineral Water and Quiche. In the case of the Sandwiches category, this effect was compounded by the lag associated with replacing the loss of an important customer contract in the period. Importantly, we maintained or grew our share in each of these categories during the period. -- Accelerating input price inflation Raw material and packaging prices increased considerably during the year with increases seen in items such as bread, flour, dairy, eggs, cooked meats, onions, glass, corrugated paper and PET. While we were able to offset most of these inflationary pressures with cost reduction initiatives in the first half of the year, the level of increase in the second half, and particularly in the final quarter, was much more significant. This was driven by global and local demand dynamics across nearly all dairy and soft commodity products. The year also saw continued labor inflation across the division, in part driven by a 6% increase in minimum wage levels in the UK in October 2006. Inflationary pressures experienced in FY07 were not recovered through customer price increases in the year and, in fact, overall sales price deflation (including trading terms and promotional support) for the year amounted to nearly 1% largely due to pricing arrangements carried forward from the previous year. 3. Strong performance against strategic and operational objectives

Despite these events and the impact on results, the Board is pleased with the underlying delivery of the Convenience Foods division against its strategic and operational objectives.

-- Market leading positions in attractive product categories The Convenience Foods division continues to compete in attractive product categories. Our key product categories and segments continue to grow at levels above the total food market and deliver strong economic returns both for our customers and for Greencore. For example, consumers continue to seek variety in the expanding food-to-go market which sees category growth rates of 5% in sandwiches, 15% in salads and 50% in sushi(2). Within Sandwiches, wraps are growing at 15% and premium sandwiches at 13%. At Cakes & Desserts, we now produce one in three Christmas cakes sold in the UK, with a gain of more than two percentage points of market share on FY06. We continue to seek No. 1 or strong No. 2 market share positions in the categories and segments in which we operate. Greencore holds the No. 1 position in eight of our nine convenience foods categories and we are the No. 2 player in the other category(2). (2) Source: TNS -- Balanced customer and channel exposure A distinctive feature of Greencore Convenience Foods is the balance that it achieves across customers and channels. Two thirds of divisional turnover is conducted through the large retailer multiple channel where the relative size of each customer is balanced to broadly reflect their respective shares of the UK grocery market. The quality of our relationships with these customers is central to the performance and prospects of our business model. High levels of consumer-centric innovation, a passion to deliver excellent in-store performance and outstanding supply chain and technical accuracy underpin these relationships. This is reflected not only in strong customer service levels for the year (averaging 99% 'right first time delivery to customer order' across the Group for the year) but also by an important number of both formal and informal customer and industry awards and recognition that our category teams received throughout the year. A significant proportion of Greencore sales are conducted through small convenience store and foodservice outlets, many of which are served by our direct store delivery model. In FY07, we grew turnover to these non-multiple customers in line with the overall divisional growth rate despite the loss of a significant sandwich customer in the second half of the year. A number of new customer "wins", together with the broader mix of products now being sold through our direct delivery model, will enable the division to extend the share of total sales to non-multiple customers going forward. -- A commitment to operational excellence and low cost Greencore is committed to being the lowest cost competitor in convenience foods - it is critical to sustaining margin delivery to our shareholders and our customers over time. The Total Lowest Cost (TLC) culture and underpinning programs are deeply embedded across all aspects and all levels of our business. As with previous years, there were more than 200 initiatives which yielded real operational cost savings of more than 2% of sales volume. The year saw a further development of our Lean Greencore program, which drove a large number of operational improvement projects targeting waste reduction, improved productivity, energy use and 'food miles' reduction. For example, initiatives at our largest chilled facility at Manton Wood have led to a 14% decrease in total waste in the year. In addition, the Group delivered a significant number of both large and small purchasing initiatives focusing on all aspects of the inbound and outbound supply chain. The Group continues to focus on the size and mix of its supplier base with a reduction of more than 100 packaging suppliers achieved during the year. In FY07, this level of TLC delivery enabled Greencore to offset much of the impact of input price inflation. -- Strong product and category innovation, supplemented with emerging branded innovation We operate in fast moving categories. Innovation is critical to delivering excitement to consumers and customers while sustaining margins. At the end of September 2007, more than 40% of our portfolio comprised products that were less than one year old. This rate of innovation is comparable to that which we have delivered in prior years. Health initiatives continue to be a key element of the Group's innovation agenda. We have now removed all trans fats and hydrogenated vegetable oils from our products and have made significant progress towards the UK Food Standards Agency's 2010 salt level targets (with some categories already achieving its required targets). For example, this drive to healthier ingredients has contributed to 100% innovation in our Cakes & Desserts category this year. In FY07, we also launched a number of new large-scale category initiatives. In the food-to-go area, we now have growing positions in the baguettes, snack salads and sushi categories, the latter enabled by the acquisition of a small sushi business. All of these segments have been new to Greencore in the last eighteen months. We have further new category and segment innovations planned for FY08. The level of branded innovation being pursued by Greencore has also increased, with 13% of turnover now branded, up 22% on FY06. Recent initiatives include the further extension of the WeightWatchers(R) license, the launch of Pudz frozen desserts and Strathlomond mineral water, the integration of the Ross pickles brand, the re-branding of Sutherland Deli and the recent launch of our Kiveton's Kitchen range targeted exclusively at the convenience store channel. -- Leveraging our Convenience Foods capabilities beyond the UK In FY07, we made considerable progress in building our chilled food businesses in the Netherlands and Ireland. Turnover in these markets rose strongly year on year and the Group is well positioned for further progress in both markets. A key initiative for the Group has been deepening our knowledge of chilled food opportunities in the US. The Group is now looking to make a modest acquisition as a means of establishing an entry route into this promising market. -- Robust financial discipline Fixed and working capital investments continue to be tightly managed. There was EUR 42.4m of new fixed capital invested in Convenience Foods in FY07. The spend continues to be focused on automation (such as new bread denesting equipment at our Sandwich sites), increasing capacity (such as new labeling and blow-moulding equipment at our Mineral Water facility) and extension into new product areas (e.g., investment at our Chilled Meals facilities to support category expansion into longer shelf-life products).

By continuing to deliver against these critical strategic and operating imperatives, we have strengthened our Convenience Foods franchise and positioned it for further progress in the coming years.

However, the division has some significant near-term challenges, the most important of which is offsetting the high levels of input price inflation. The UK food manufacturing industry is facing unprecedented inflationary pressures, driven principally by rapid rises in food commodity pricing. The 'cost of goods' to our Convenience Foods division is now anticipated to increase by 8% to 10% in FY08. Recovering this inflation with appropriate price increases is a critical challenge. To date, we are encouraged by our success in working with our key customers to offset these impacts.

OPERATIONAL REVIEW - Ingredients & Related Property FY07 FY06 Change EUR m EUR m Turnover (Continuing Operations) 334.0 275.3 21% Operating Profit (Continuing Operations) 26.6 5.6 372%

In the year under review, the Ingredients & Related Property division delivered a significant improvement in performance. Turnover rose by 21% to EUR 334.0m and operating profit increased by 372% to EUR 26.6m. This performance has brought operating profit close to the level of total divisional pre-tax operating profit of EUR 27.6m achieved in FY06 which included EUR 22.0m of pre-tax sugar profits. All elements of the division delivered material growth in both turnover and operating profit but the most significant driver of divisional performance was the strong recovery in our Malt business. This recovery was most evident in the second half of the year, with approximately 70% of divisional profits delivered during that period. The Group also made considerable progress in adding value to each of the four significant Related Property sites, with positive zoning progress emerging at Mallow (396 acres), Carlow (333 acres) and Littlehampton (123 acres) and planning submissions lodged for our now rezoned site in Athy (40 acres).

1. Recovery of Malt to acceptable returns

Malt represents approximately 60% of divisional turnover. The anticipated recovery in the Group's Malt business took root in FY07, driven by a combination of a global rebalancing of capacity and demand, an improved industry structure in the UK, the benefits of our FY05 and FY06 restructuring programs, and strong commercial and operational performance.

-- An improved global malt environment The combination of robust global demand for beer and whisky and a slowdown in the growth of Malt capacity has led to a better balance between supply and demand. Concerns regarding malt availability have been compounded by lower malting barley sowings and difficult harvests in the key source markets. The combination of a more balanced demand and capacity environment in malt markets and barley scarcity has shifted the focus of maltsters and brewers/distillers away from cost towards securing supply. The impact of these changes is most evident in the UK, our largest malt market. -- Benefits flowing from restructuring activity on FY05 and FY06 Greencore rationalized its Malt capacity in the UK and Ireland by approximately 115,000 tonnes with the closure of its less competitive Ipswich, Carnoustie and Banagher maltings in FY05. The benefits of those closures were augmented by a restructuring program at each of our seven remaining malting facilities in FY06. These changes have delivered a leaner, more efficient Malt business model. -- Strong commercial and operational performance Our Malt business has delivered strong operational performance in all geographies. With a leaner asset footprint, the business has focused on domestic beer and whisky markets, resulting in a significant reduction in the volumes sold into more commoditized global markets. Malt production rose by 3% to a record 512,000 tonnes across our remaining assets and strong sourcing, manufacturing, logistical and commercial performance enabled us to fulfill the needs of our customers despite a challenging raw material environment.

The impact of industry changes and Greencore initiatives has been to bring Malt back to an acceptable level of return. In FY07, Malt launched a number of initiatives designed to better secure our future returns. These included the decision to expand our maltings in Scotland to support the increased demand for Scottish whisky, the establishment of Global Malting Services to provide value-added support to brewers and maltsters in the developing world, and the securing of a number of long-term partnerships with key domestic customers.

The industry dynamics experienced in FY07 are expected to continue. These factors, allied to focused commercial and operational performance across our business, position Greencore Malt for further progress in the coming years.

2. Momentum in other Ingredients & Related Property businesses

Greencore operates three other ingredient businesses in Ireland - Trilby Trading, Drummonds and Premier Molasses. All three delivered improved sales, profit and cash performance in FY07. While individually modest and mature categories, these businesses have strong market positions, customer relationships and cashflow and make a positive overall contribution to divisional performance.

During the year under review, the Group disposed of five small surplus properties in Ireland (17 acres in total) that had previously been part of the Group's agri-business network. This level of disposal represents an increase on the two disposals (totaling eleven acres) made in FY06 and has led to an increase of approximately EUR 4m in related property profits year-on-year. The FY07 level of surplus property disposals is similar to budgeted plans for small non-core property disposals in FY08.

3. Adding value to our four significant Related Property sites

The Group's longer-term property strategy is focused on adding value to high potential development property sites. In FY07, we have made excellent progress in enhancing the zoning and planning status at each of our four significant properties (representing 892 acres of potential development land). While there is considerable work to do to deliver the full potential of these properties over the coming years, progress achieved to date has been very encouraging.

-- 'Mallow West' (396 acres) In July 2007, our Mallow site was allocated a zoning objective for high density mixed use and tourism/leisure use, with the specifics to be determined by agreement with Cork County Council. The master-planning process is progressing well and, although the specific timing is a matter for the Council, we expect it to conclude by March 2008. As part of this process, in September 2007, the Mallow West Development Board (chaired by Redmond O' Donoghue) was established to frame the plan for the enterprise aspects of the Mallow West Plan. -- 'Carlow Gateway' (333 acres) Carlow County Council is expected to publish its draft Local Area Plan (LAP) in the coming months. This LAP will consider the Carlow Gateway plan we submitted to the Council. Our plan has generated significant levels of community and stakeholder support to date but, ultimately, the decision will be a matter for the county councils. We look forward to publication of the Carlow draft LAP. 110 acres of the Carlow Gateway site is located in Laois and Laois County Council has undertaken to consider the Laois aspects of Carlow Gateway once the Carlow LAP advances. We expect both processes to conclude before the end of FY08. -- Athy (40 acres) In August 2007, we lodged a planning application for the first phase of a retail scheme on approximately ten acres of our forty-acre site in Athy. This was followed in October 2007 by a second application for an additional ten acres of complementary retail warehousing. The remaining acres will be planned after these first phases have been worked through the planning process. -- Littlehampton (123 acres) In addition to the above Irish property projects, the Group is leading an effort to redevelop 123 acres in north Littlehampton that was acquired as part of Hazlewood Foods in 2001. In collaboration with other landowners, Greencore is now leading a consortium to promote 170 acres of former glasshouse land on the northern edge of Littlehampton in West Sussex. Greencore owns 123 aces of the consortium lands. In August 2007, the local district council published its draft Core Strategy Plan (CSP) for addressing the future housing needs of the area. Our consortium site was, at this first stage, earmarked as a key contributing site for 1,500 homes and 30,000m2 of employment space, together with associated new infrastructure. This was targeted by the CSP for delivery in the period from early 2011 to 2016. It is possible that a planning application will be made in 2009, in advance of a formal zoning decision expected in 2010, although there are significant consultation and development appraisal processes to be conducted in advance of this.

Separate to these substantial property projects, the Group is carrying out development appraisals for four other smaller sites (approximately twenty acres) that are at earlier stages of the re-zoning or planning processes. The Group also continues to monitor the value in use of its remaining property assets against their development potential.

4. Close to finalization of issues surrounding Sugar Exit

The Group's exit from its Irish sugar-processing operations has progressed well. To date, the Group has been able to deal with aspects of its former sugar operations at a somewhat lower cost than envisaged in the Restructuring Plan. This has resulted in an exceptional gain of EUR 10.9m in the period under review, largely reflecting a reversal of the impairment of certain sugar assets contained in the FY06 accounts.

Greencore received its first tranche of EU aid totaling EUR 43.6m in July 2007. The Board welcomed the Irish High Court judgment in June 2007 that set aside the Irish Government's decision of July 2006 on the allocation of EU aid. The Government has lodged an appeal to the High Court decision. In September 2007, the EU Council of Ministers voted to amend Regulations 318, 320 and 968, the effect of which should raise the minimum EU aid payable to Greencore to EUR 112.1m (less the EUR 43.6m already received). While the Board remains confident of its original entitlement to full EU aid (a total of EUR 130.9m), the fact that our entitlement remains subject to legal appeal has led the Group to account for a 'virtually certain' receivable of EUR 112.1m (of which EUR 43.6 has already been received). As a result, the accounts contain an exceptional benefit of EUR 10.2m which has been recorded in this year's accounts to reflect the difference between the value of the receivable recorded in the FY06 accounts (the EUR 98.4m allocated to Greencore in the Government's decision of July 2006) and the present value of EUR 112.1m.

5. Sale of largest Associate holding

In August 2007, the Group completed the sale of its fifty percent shareholding in Odlum Group to Origin Enterprises PLC ('Origin'). As part of the sale, Greencore received EUR 35m in cash and Origin assumed approximately EUR 10m of the Odlum Group's net debt. The Group recorded an exceptional profit of EUR 24.2m on the transaction.

FINANCIAL REVIEW

The results have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

1. Earnings

Results for the financial period totaled EUR 111.8m, up from EUR 0.3m in FY06. Group operating profit from continuing operations (pre-exceptional) totaled EUR 91.0m for FY07, an increase of 22% on FY06 (EUR 74.6m). Profit before tax (pre-exceptional) of EUR 75.1m was up 32% on FY06 EUR 56.8m).

Basic EPS for FY07 was 55.5 cents, up from -0.2c in FY06. Adjusted EPS for FY07 (stripping out exceptional items and the EUR 1.2m gain resulting from the impact of inter-company foreign exchange and the effect of marking-to- market our trading derivatives) was 30.6 cents versus 31.1 cents in FY06. This is based on a weighted average number of ordinary shares of 198.9m (FY06: 196.2m).

2. Finance

Comparable net debt which excludes the impact of marking-to-market all derivative financial instruments and related debt adjustments was EUR 320.5m at September 28, 2007. This reflects a reduction of EUR 64.9m from the September 2006 figure and a reduction of EUR 72.4m since March 2007. This debt movement reflects EUR 35m of consideration from the Odlums disposal, net inflows from the sugar exit (EU aid less cash outflows) of EUR 18.0m, but cash outflows associated primarily with an increase in working capital (driven by increased stock value of commodity ingredients) of EUR 16.1m. The underlying trajectory of cash generation remains in place.

The Group's net finance charge for the period was EUR 16.7m, driven by: -- Net bank interest cost on comparable net debt of EUR 30.6m (FY06: EUR 30.7m) -- A net pension credit of EUR 10.2m (FY06: EUR 7.0m), representing the difference between the expected return on defined benefit scheme plan assets and the finance cost of those liabilities -- A benefit of EUR 2.5m related to income arising on the increase in the present value of the EU sugar aid receivable -- A net gain of EUR 1.2m (FY06: EUR 5.7m), reflecting the impact of inter-company foreign exchange losses and marking-to-market gains on our trading derivatives. 3. Taxation

The Group's tax charge on continuing operations (excluding exceptionals and associates) was EUR 13.1m. The effective tax rate on continuing operations (pre-exceptional) was reduced to 18% for the year (FY06: 22.5%), reflecting a change in the mix of the Group's profits. The amount of cash taxation continues to be well below the tax charge.

4. Exceptional items

The Group incurred an exceptional benefit (net of tax) of EUR 48.2m in the period under review (full details of which are contained in Note 3 to the Preliminary Statement). This total benefit (net of tax) comprised five separate areas: -- Associate Disposal EUR 24.2m benefit from the sale of the Group's 50% shareholding in the Odlum Group -- Sugar Exit EUR 21.1m net benefit (versus FY06 net exit provisions) related to the exit from sugar processing in Ireland -- Agribusiness Disposal EUR 3.0m benefit from the sale of Irish agri-businesses -- Adjustment on Business Termination EUR 4.1m benefit related to the finalization of matters associated with a 2005 disposal -- Lease Obligations EUR 4.3m charge to address the Group's property obligations on selected properties 5. Capital Investment

EUR 49.2m of capital investment was made in the period (FY06: EUR 47.9m). The depreciation charge on our continuing businesses of EUR 29.7m is lower than the FY06 level of EUR 32.4m, with the reduction in depreciation reflecting an aging of assets and asset life assessments, netted against depreciation on capital additions.

6. Pensions

The fair value of total plan assets relating to the Group's defined benefit pension schemes (excluding associates) increased to EUR 547.3m at September 2007 from EUR 539.9m at September 2006. The present value of total pension liabilities for these schemes decreased to EUR 573.1m from EUR 591.5m over the same period. This is reflected in a reduction in the net pension deficit (before related deferred tax) to EUR 25.8m at September 2007 (from a net pension deficit of EUR 51.6m at September 2006). The Group has agreed funding proposals to address the relevant deficits.

The primary Irish scheme, the Greencore Group Pension Scheme, had a surplus (before related deferred tax) of EUR 37.5m at September 2007. Given its strong funding position and the relative maturity of the scheme, the Group and Trustees have begun a review of the risk profile of the scheme. The results of this review will likely impact both the risk and the expected rate of return of the scheme assets in future years.

NOTES TO THE PRELIMINARY STATEMENT year ended September 28, 2007 1. Basis of Preparation of Financial Information under IFRS

The financial information presented in this preliminary announcement has been prepared in accordance with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations adopted by the European Union (EU) and with those parts of the Companies Acts, 1963 to 2006, applicable to companies reporting under IFRS.

The financial information, which is presented in euro and rounded to the nearest thousand (unless otherwise stated), has been prepared under the historical cost convention, as modified by the revaluation of property, plant and equipment, and the measurement at fair value of certain financial assets and financial liabilities, including share options, available for sale investments and derivative financial instruments. The carrying values of recognized assets and liabilities that are hedged are adjusted to record the changes in the fair values attributable to the risks being hedged. Full details of the Group's accounting policies will be included in the 2007 annual report which will be distributed in January 2008.

2. Segmental Reporting

The Group's primary reporting segment is by class of business. The Group has two primary reporting segments: (i) Convenience Foods and (ii) Ingredients & Related Property. Revenue Operating Profit 2007 2006 2007 2006 EUR '000 EUR '000 EUR '000 EUR '000 GROUP SUBSIDIARIES Continuing Convenience Foods 933,149 901,443 64,417 68,967 Ingredients & Related Property 334,007 275,341 26,624 5,643 Total continuing 1,267,156 1,176,784 91,041 74,610 Discontinued Convenience Foods - - - - Ingredients & Related Property - 175,161 - 21,991 Total discontinued - 175,161 - 21,991 ASSOCIATED UNDERTAKINGS Ingredients & Related Property Continuing (pre interest & tax) 27,343 6,285 1,087 443 Discontinued (pre interest & tax) 36,406 37,899 2,250 3,414 3. Exceptional Items

Exceptional items are those that, in management's judgment, need to be disclosed by virtue of their nature or amount. Such items are included within the income statement caption to which they relate and are separately disclosed in the notes to the consolidated financial statements.

The Group reports the following exceptional items (net of tax): 2007 2006 EUR '000 EUR '000 Continuing operations Lease obligation provision (a) (4,265) - Malt legal settlement (f) - 4,930 Malt restructuring (g) - (4,459) Pension curtailment gain (h) - 3,365 Chilled Sauce business restructuring (i) - (2,009) Total continuing operations (4,265) 1,827 Discontinued operations Exit from sugar processing (b) 21,134 (68,903) Profit on disposal of investment in associate (c) 24,158 - Reduction in provision for loss on termination of operations (d) 4,117 - Profit on business disposals (e) 3,046 - Total discontinued operations 52,455 (68,903) Total exceptional gains/(costs) 48,190 (67,076) (a) Lease obligation provision Following a strategic review of the Group's property portfolio, a decision was made to provide for the exit costs associated with terminating certain leases. The exceptional loss of EUR 4.3m represents the costs associated with these obligations. (b) Exit from sugar processing During 2006, Greencore confirmed its intention to exit sugar processing in Ireland, renounce its quota and apply for EU restructuring aid under the Council Regulations (EC) No. 320/2006 and No. 968/2006 (the Regulations). The total EU restructuring aid available for the sugar quota renounced by Greencore is EUR 145.5m. These Regulations, prior to their recent amendment, stated, inter alia, that at least 10% of the restructuring aid shall be reserved for sugar beet growers and machinery contractors. The Regulations gave Member States the responsibility to determine if this percentage is to be increased, but imposed on Member States the requirement to ensure that an economically sound balance between the elements of the restructuring plan is achieved. In July 2006, the Government announced that it was allocating 67.6% (representing EUR 98.4m) to Greencore, with the balance of the EU aid to be allocated to sugar beet growers and machinery contractors. The Board of Greencore rejected the basis of this allocation and sought a judicial review of the decision in the High Court. The findings of this judicial review were issued in June 2007 and the Government's decision regarding allocation of the restructuring aid was quashed. The Government has subsequently indicated that it may appeal the High Court judgment to the Supreme Court. Although the matter of the final allocation of restructuring aid had yet to be finalized, the Government deemed Greencore's restructuring plan (which was submitted to the Government on July 31, 2006) to be eligible for restructuring aid (on September 19, 2006). Additionally, Greencore agreed that it would amend this plan to reflect any lawful decision of the Government taken pursuant to the outcome of the legal proceedings. On this basis, the Group has further progressed its exit from sugar processing during 2007. The financial consequences to Greencore are as follows: 2007 2006 EUR 'm EUR 'm Reversal of/(recognition of) write-down and impairment of assets 8.4 (115.0) Environmental, remediation, demolition, redundancy & other costs 2.5 (49.8) 10.9 (164.8) Present value of additional EU restructuring aid which may be regarded as virtually certain 10.2 95.9 Net exceptional gain/(charge) 21.1 (68.9) -- Restructuring costs As at September 28, 2007, the costs associated with exiting from the sugar processing business and delivering the elements of the eligible restructuring plan are estimated at EUR 153.9m (2006: EUR 164.8m). -- Accounting for the receipt of EU aid The Group's entitlement to EU Restructuring Aid is estimated to be EUR 130.9m. At September 29, 2006, the receipt of EUR 98.4m was regarded as virtually certain and the present value of that amount was recorded in the September 2006 financial statements. EUR 43.6m of this amount was received during 2007. On September 26, 2007, the European Council approved changes to the sugar restructuring scheme and on October 9, 2007, the EU published amendments to the relevant regulations. These amendments should result in Greencore becoming entitled to a minimum amount of EUR 112.1m, even in circumstances where any appeal to the Supreme Court by the Government might be upheld. As a result, Greencore now regards the receipt of EUR 112.1m as virtually certain. The present value of the outstanding receivable of EUR 68.4m (being EUR 65.0m) has been included as an asset in the year-end balance sheet. Given the possible protracted nature of the abovementioned appeal to the Supreme Court by the Government, this receivable has been included in non-current assets. The balance of the Group's entitlement of EUR 17.8m (that being the present value of the difference between EUR 130.9m and EUR 112.1m) which cannot yet be reasonably regarded as virtually certain, is treated as a contingent asset and, therefore, disclosed but not recognized as a receivable. (c) Profit on disposal of investment in associate In August 2007, the Group's investment in the Odlums Group (an associate investment) was sold for a consideration of EUR 35.0m. The Group recorded an exceptional gain of EUR 24.2m (net of tax) on this transaction. (d) Reduction in provision for loss on termination of operations In September 2005, the Group made a provision of EUR 40.1m (net of tax) for the costs associated with the disposal of a business for a nominal consideration. The exceptional item booked at that time included a provision to write down all of the relevant assets to their recoverable amount and to cover all costs associated with this business termination. The EUR 4.1m exceptional credit represents a gain associated with the finalization of the treatment of certain items associated with that provision/exit. (e) Profit on business disposals Exceptional gains of EUR 3.0m arose on the disposal of agri-businesses whose activities were closely related to sugar processing (a business which Greencore exited during the year ended September 29, 2006). (f) Malt legal settlement During 2006, the Group settled an outstanding claim related to Greencore Malt at EUR 4.9m (net of costs). (g) Malt restructuring Greencore Malt closed three maltings during 2005. In 2006, the business continued this restructuring work focusing specifically on its core operations in both Ireland and the UK. The exceptional loss represents the costs associated with this business restructuring. (h) Pension curtailment gain In April 2006, a number of changes in benefit design were implemented in respect of the Hazlewood Foods Retirement Benefits Scheme. These changes included a shift to a career average revalued basis in respect of accrued benefits with revaluation set at the level of limited price inflation. It also included the integration of the scheme with the basic state pension in respect of future service. These scheme amendments, net of related costs, resulted in an exceptional pension curtailment gain (net of tax) of EUR 3.4m. (i) Chilled Sauces business restructuring Following a strategic review at Greencore Chilled Sauces, a decision was made to consolidate all chilled sauce manufacturing at the Bristol facility and to close the Chesterfield factory. The exceptional loss of EUR 2.0m represents the costs associated with this decision. 4. Dividends 2007 2006 EUR '000 EUR '000 Amounts recognized as distributions to equity holders in the year: Equity dividends on ordinary shares: Final dividend of 7.58c for the year ended September 29, 2006 (2005: 7.58c) 15,053 14,853 Interim dividend of 5.05c for the year ended September 28, 2007 (2006: 5.05c) 10,058 9,961 25,111 24,814 Proposed for approval at AGM: Equity dividends on ordinary shares: Final dividend of 8.21c for the year ended September 28, 2007 (2006: 7.58c) 16,404 15,053

This proposed final dividend is payable on April 4, 2008 to shareholders on the Register of Members at December 7, 2007.

This proposed dividend is subject to approval by the shareholders at the annual general meeting and has not been included as a liability in the balance sheet of the Group as at September 28, 2007, in accordance with IAS 10 'Events after the Balance Sheet Date'.

5. Earnings per Ordinary Share

The calculation of the Group's basic earnings per ordinary share for continuing operations is based on a profit of EUR 56.3m (2006: EUR 46.4m) and on 198.9m ordinary shares (2006: 196.2m), being the weighted average number of ordinary shares in issue in the period. The calculation of basic earnings per ordinary share from discontinued operations is based on a profit of EUR 54.1m (2006: loss of EUR 46.9m).

The calculation of the diluted earnings per ordinary share for continuing operations is based on a profit of EUR 56.3m (2006: EUR 46.4m) and on 199.5m ordinary shares (2006: 196.9m) being the weighted average number of ordinary shares outstanding assuming conversion of all dilutive potential ordinary shares. Employee share options, which are performance-based, are treated as contingently issuable shares because their issue is contingent upon satisfaction of specified performance conditions in addition to the passage of time. These contingently issuable ordinary shares are excluded from the computation of diluted earnings per ordinary share where the conditions governing exercisability have not been satisfied as at the end of the reporting period. The calculation of diluted earnings per ordinary share from discontinued operations is based on a profit of EUR 54.1m (2006: loss of EUR 46.9m).

The Group's adjusted earnings per share is calculated after the elimination of the exceptional items reported in note 3, inter-company foreign exchange gains/(losses) and the movement in the fair value of derivative financial instruments and related debt adjustments. The Group separately presents adjusted earnings per share for continuing operations and discontinued operations.

The calculation of adjusted earnings per ordinary share from continuing operations is based on a pre-exceptional profit of EUR 61.9m (2006: EUR 45.3m) adjusted to exclude inter-company foreign exchange gains/(losses) and the movement in the fair value of derivative financial instruments and related debt adjustments totaling EUR 1.2m (2006: EUR 5.7m). The calculation of adjusted earnings per ordinary share from discontinued operations is based on a pre-exceptional profit of EUR 1.6m (2006: EUR 22.0m). The weighted average number of ordinary shares in issue during the period was 198.9m (2006: 196.2m).

2007 2006 cent cent Adjusted EPS - continuing operations 29.8 19.9 Adjusted EPS - discontinued operations 0.8 11.2 30.6 31.1 6. Components of Net Debt and Financing 2007 2006 EUR '000 EUR '000 Net Debt Current assets Cash and cash equivalents 117,949 78,967 Current liabilities Borrowings (81,919) (265) Non-current liabilities Borrowings before fair value adjustment (356,567) (464,127) Comparable net debt (320,537) (385,425) Borrowings - fair value hedge adjustment (non-current liabilities) 40,233 30,470 Total cash, cash equivalents & borrowing (280,304) (354,955) Finance (Costs)/Income Net finance costs on interest bearing cash and cash equivalents and borrowings (30,633) (30,717) Net pension financing credit 10,182 6,987 Change in fair value of derivatives 2,645 5,157 Foreign exchange (loss)/gain (1,399) 500 Increase in the present value of the EU receivable 2,507 - (16,698) (18,073) Analysed as: Finance income 43,645 35,929 Finance costs (60,343) (54,002) (16,698) (18,073) 7. Taxation Analysis of charge/(credit) in year 2007 2006 EUR '000 EUR '000 Continuing Operations Corporation tax charge 2,869 5,041 Overseas tax charge/(credit) 1,774 (867) 4,643 4,174 Deferred tax 8,488 7,273 Income tax expense (pre-exceptional) 13,131 11,447 Tax on exceptional items Current tax credit - (1,452) Deferred tax (credit)/charge (1,658) 1,442 Exceptional tax credit (1,658) (10) Income tax charge from continuing operations (pre associates) 11,473 11,437 Discontinued operations Pre-exceptional Current tax charge for the year (including discontinued associate) 195 2,966 Exceptional Current tax charge for the year - - Deferred tax (credit)/charge for the year (3,597) 221 Total income tax (credit)/charge from discontinued operations (3,402) 3,187 Total income tax charge for the year 8,071 14,624 8. Information

The financial information in this preliminary announcement is not the statutory accounts of the company, a copy of which is required to be annexed to the Company's annual return to the Companies Registration Office.

The annual report and accounts will be circulated to shareholders on January 14, 2008, prior to the annual general meeting to be held on February 14, 2008, in the Conrad Hotel, Earlsfort Terrace, Dublin 2, Ireland.

By order of the Board, CM Bergin, Company Secretary, November 27, 2007, Greencore Group PLC, St Stephen's Green House, Earlsfort Terrace, Dublin 2, Ireland.

For tabular information, please contact Taylor Rafferty +1 212 889 4350

Greencore Group PLC

CONTACT: David Dilger, Group Chief Executive, +353 (0)1 605 1045; or
Patrick Coveney, Chief Financial Officer, +353 (0)1 605 1018; or Eoin
Tonge, Group Capital Markets Director, +353 (0)1 605 1036; all of Greencore
Group PLC; or Billy Murphy or Anne-Marie Curran, both of Drury
Communications, +353 (0)1 260 5000; or Rory Godson of Powerscourt, +44
(0)207 250 1446; all for Greencore Group PLC