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Frucor Secures Listings with Top UK Grocery Chains


2 June 2000

Frucor Secures Listings with Top UK Grocery Chains

Leading designer beverage company Frucor Beverages Group Limited today announced it has secured listings for its number one energy drink V with Sainsbury's and Tesco, the leading grocery chains in the UK, and petrol giant BP. The UK market is highly lucrative and is valued at NZ$1 billion.

Frucor gained Tesco listing confirmation at the outset of its UK launch last month and Sainsbury's has now confirmed their listing.

Sainsbury's is the latest of more than 40 leading retailers, wholesalers and forecourt operators in the UK who have agreed to stock V in the seven weeks since launch.

Based on its extremely successful New Zealand and Australian experience, BP has wholeheartedly embraced V, making the product available in approximately 500 service stations nationwide. WH Smith Travel, with outlets in the major airports and train stations, has provided strong support for the brand with a dozen huge digital screens featuring the V 'bug' commercial.

Frucor Beverages Managing Director Mark Cowsill said Sainsbury's selected V from an extensive list of energy drink participants.

"Our established experience in product marketing and category development in new markets with the strong performance track record of V in the New Zealand, Australian and South African markets is the foundation of V's expected success in the UK. Using market research and innovative and targeted marketing we know we can grow the category and volumes. We have done it before. Frucor's model replicates very successfully."

Frucor's investment in marketing promotion next year will be $NZ35.7million, well up from its spend last year of $19.4million. A significant proportion of this spend will relate to the UK launch.

V holds over 60 percent market share of the energy drinks category in Australia and this category has increased threefold since the August quarter of 1999. In New Zealand the brand has been available for over three years and continues to hold over 60 percent market share.

Mr Cowsill said the successful entry into new markets is one facet of the company's three pronged growth strategy.

"We are focused on continuing to achieve high growth in the international beverage arena by actively pursuing further global expansion into new growth markets, leveraging our already significant Australian presence and continuing to grow our highly profitable New Zealand market."

On the basis of this strategy, Frucor has achieved significant earnings growth. EBITDA has increased by 337 percent from NZ$4.1 million in 1996 to NZ$17.9 million in F1999. Strong growth is expected to continue, with EBITDA before transaction expenses for F2000 forecast to be NZ$31.0 million.

Frucor Beverages Chairman Simon Pillar said the immediate positive response from the UK market to V and the strong growth achieved by the company indicates that the company's forecast growth rates to 2001F are based on what could be regarded as conservative assumptions.

"Our current run rates approximate those required to achieve our 2001 forecast. The assumptions underlying our 2001F EBITDA of NZ$42.5 reflect the performance the business has already demonstrated it is capable of achieving."

"A combination of proven growth in the Australasian markets, the significant earning potential in overseas markets through capitalising on global trends towards functional foods and beverages makes Frucor a compelling proposition," said Mr Pillar.

Frucor recently announced it had lodged a Prospectus to float 62.625 million shares in an international offering and that it expected to list on the New Zealand Stock Exchange and the Australian Stock Exchange in mid June (see below).

About Frucor Beverages

Frucor Beverages is a leading designer beverage company. It is an international company with proven market leadership.

Its diverse and powerful portfolio of brands is concentrated on premium, high growth beverage categories. Products include leading energy drink V, other new age drinks Muse and gforce, fruit juices Fresh-Up and Just Juice ? market leaders and New Zealand icons for more than 15 years ? and popular brands such as Stefan's, McCoy, Citrus Tree, NZ Natural, H2GO and Kokomo.

With 25 projects under development, innovation in niche markets is a key element of the company's business.

Its stellar brand V is now sold in four major markets. Within 12 months of its launch in Australia V captured over 60 percent of the market share in the fast growing energy drinks market. It was also launched in South Africa in October 1999 and into the NZ$1 billion UK energy drinks market in May 2000.

Since November last year Frucor Beverages has been responsible for manufacturing and distributing major brands in the carbonated soft drinks market (the largest category in the New Zealand cold beverages market) including the Pepsi range, 7Up, Mountain Dew and Mirinda. Frucor Beverages now has around 10 percent of this market.

For more details of the offer please refer to the Investment Statement and the Prospectus dated May 19 2000. Application can only be made on an application attached to the Investment Statement (for New Zealanders) and the Prospectus (for Australians). Copies of these documents are generally available from the Joint Global Coordinators Salomon Smith Barney Australia Securities Pty Ltd and Credit Suisse First Boston NZ Securities Ltd and may be downloaded from the Internet at

Application has been made to the New Zealand Stock Exchange for permission to list the shares and all the requirements of the Exchange relating thereto that can be complied with on or before the date of this advertisement have been duly complied with. However, the Exchange accepts no responsibility for any statement in this advertisement.


For further information: Simon Pillar, Chairman, Frucor Beverages Group Limited Tel: 00612 9229 1400 Mob: 0061412 404 627


Mark Cowsill, Managing Director, Frucor Beverages Group Limited

Tel: +64 9 250 0121 Mob: +64 21 742 421

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