President and CEO Bengt Baron comments on the results for the second quarter of 2015

Continued improved operating profit and growth.
Cloetta’s operating profit (EBIT) grew by 52.9 per cent and amounted to SEK 130m
(85) in the quarter. Sales have also increased, mainly due through organic
growth and acquisitions but also exchange rate differences. The underlying
operating profit was SEK 129m (110). The operating profit margin and underlying
EBIT margin strengthened to 10.2 per cent (6.9) and 10.3 per cent (9.4),
respectively. Profit after tax also improved significantly and amounted to SEK
66m (9).

The confectionery market

The confectionery market showed positive development or was unchanged in all
markets except in the Netherlands, where it declined.

Increased sales

Cloetta’s sales for the quarter rose by 3.4 per cent, of which organic growth
accounted for 0.8 per cent, acquisitions for 1.2 per cent and changes in
exchange rates for 1.4 per cent. Cloetta is growing organically despite lower
sales in Italy, the Netherlands and Norway. Sales increased in Sweden, Finland
and Denmark. Sales of Nutisal and The Jelly Bean Factory also increased in the
quarter. The increase in sales in Denmark is explained by increased sales of
pastilles and the sales growth in Finland is attributable to product launches
and Pick & Mix.

Sales of the new Pick & Mix concept in Sweden developed according to plan.
However, Cloetta has lost sales to some of the largest customers in Sweden,
mainly due to ongoing contract negotiations. Consequently, there is a risk that
sales to these customers in Sweden will continue to be negatively affected for
some period. There is a similar situation with one major customer in Norway.
Cloetta stands by its principle that cost changes, regardless of direction, in
raw material and exchange rates ought to be passed on to the customers and
consumers.

Strong cash flow and lower debt

Cloetta’s robust cash-generating ability has once again resulted in a very
strong cash flow. The net debt/EBITDA ratio has continued to decrease and has
now reached 3.30x (4.55). The long-term target of a net debt/EBITDA ratio of
around 2.5x remains unchanged.

The acquisition of Lonka creates value

Cloetta has signed an agreement to acquire Locawo B.V. (Lonka) – a Dutch company
producing and selling fudge, nougat and chocolate. The acquisition will
significantly strengthen Cloetta’s position in the Netherlands, but also the
Nordic countries and the UK are important markets, especially within Pick & Mix.
The acquisition will diversify Cloetta’s product range into new categories and
technologies including the Dutch chocolate market. It will also create cost
synergies, thereby over time supporting Cloetta’s long term EBIT-target.

Strategy paying off

Cloetta’s strategy for profitable growth is generating continuous improvements.
We have been able to demonstrate organic growth in the past few years while at
the same time completing acquisitions to further accelerate growth. In nine of
the past ten quarters, we have improved our operating profit compared to the
previous year. And for the first time after several quarters of decreasing
restructuring costs, Cloetta can report a quarter completely free from
restructuring charges. This demonstrates our ability to execute. After six years
at the helm, I therefore feel good about handing over to David Nuutinen as the
new President and CEO of Cloetta. I would also like to take this opportunity to
extend my gratitude to the employees, shareholders, Board of Directors,
customers and consumers who have in various ways contributed to Cloetta’s
development during the years when I have had the pleasure of serving as CEO.

The information contained in this press release is such that Cloetta is required
to disclose pursuant to the Swedish Financial Instruments Trading Act and/or the
Swedish Securities Markets Act. The information was submitted for publication on
17 July 2015 at 08:00 a.m. CET.
Media contact
Jacob Broberg, SVP Corporate Communications & Investor Relations, +46 70 190 00
33.
About Cloetta
Cloetta, founded in 1862, is a leading confectionary company in the Nordic
region, the Netherlands, and Italy. In total, Cloetta products are sold in more
than 50 countries worldwide. Cloetta owns some of the strongest brands on the
market, such as Läkerol, Cloetta, Jenkki, Kexchoklad, Malaco, Sportlife, Saila,
Red Band and Sperlari. Cloetta has 11 production units in six countries.
Cloetta’s class B-shares are traded on Nasdaq Stockholm. More information about
Cloetta is available on www.cloetta.com