EANS-Adhoc: Valora Holding AG / Valora Group reports external sales up 6.5 percent - earnings adversely affected by persistent contraction of press market - retail expertise strengthened

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6-month report/Valora Group reports external sales up 6.5 percent -
earnings adversely affected by persistent contraction of press market
- retail expertise strengthened

23.08.2012

Valora Group reports external sales up 6.5 percent - earnings
adversely affected by persistent contraction of press market - retail
expertise strengthened

- External sales and gross profits increased thanks to successful
acquisitions - Valora Retail outperforms local competitors - Earnings
adversely affected by persistent contraction of press market,
challenging market environment and higher costs at Corporate division
- Sale of Valora Services Austria reduces Group's dependence on press
market - Agreement signed for sale of Muttenz facility, generating
financing for future investments - Outlook: focus on core areas of
expertise with a view to strengthening retail activities

External sales and gross profits increased thanks to successful
acquisitions - Valora Retail outperforms local competitors

Pronounced press market contraction and Swiss consumers' enthusiasm
for cross-border shopping continued to characterise business
conditions in the first six months of 2012. Despite these challenges,
the Valora Group generated external sales of CHF 1 568.8 million, a
+6.5 percent increase on the same period of 2011. With external sales
of some CHF 124 million generated through its network of more than 1
200 outlets, Convenience Concept GmbH, which Valora successfully
acquired in early April 2012, made a positive contribution to Group
performance.

The Valora Group's reported first-half 2012 net revenues came in at
CHF 1 387.2 million, a modest -0.7 percent lower than a year earlier.
The main adverse factors affecting the Group's performance were the
weaker press market, which depressed sales by CHF -20.0 million, and
the contraction of the Services division's relatively low-margin
wholesale business, which reduced turnover by some CHF -40 million.
Additional sales totalling CHF 18.6 million were generated from the
distribution and sale of Euro 2012 collectible football picture
cards, while adverse exchange-rate effects reduced revenues by CHF
-28.9 million.

Valora raised its gross profits by CHF 12.1 million compared to their
first-half 2011 level, thanks to the advances achieved by the Group's
Retail and Trade divisions, both of which were able to capitalise on
successful acquisitions. First-half 2012 also saw Valora Retail's
sales grow faster than the local markets in which it operates.

Earnings adversely affected by persistent contraction of press
market, challenging market environment and higher costs at Corporate
division

The +5.6% increase in reported operating costs is essentially
attributable to the acquisitions Valora successfully integrated into
its operations in the first six months of 2012 and to costs incurred
in evaluating additional options for potential expansion. The higher
costs incurred by the Group's Corporate division resulted from the
transition phase of the IT outsourcing project and the set-up
arrangements required for new logistics customers. Valora Retail's
extension of its agency business model contributed positively to
operating profit.

The decline in the overall press market and the demanding conditions
facing the retail sector resulted in the Valora Group generating a
reported operating profit of CHF 22.4 million in the first six months
of 2012, compared to CHF 33.4 million a year earlier. Operating
profit generated from the distribution and sale of Euro 2012 picture
cards amounted to CHF 3.2 million.

The Valora Group's net profit for the first six months of 2012 was
CHF 15.1 million (CHF 26.3 million in first-half 2011). The financing
requirements for the two acquisitions the Group made as part of its
Valora 4 Growth strategy - Convenience Concept GmbH and Schmelzer &
Bettenhaussen GmbH & Co. KG - amounted to approximately CHF 90
million. As a result, the Group's net debt rose to CHF 219 million at
June 30, 2012 and its shareholders' equity accounted for 34.5 percent
of total assets is still at a very sound level.

Divisions

Valora Retail Thanks to its acquisitions of Convenience Concept in
Germany and Schmelzer & Bettenhausen in Austria, Valora Retail was
able to increase its external sales by +13.3 percent on their
first-half 2011 levels, to reach CHF 991.0 million. Valora Trade
Germany generated external sales of CHF 317 million (up +57.7 percent
on the same period of 2011), while those at the Luxembourg country
unit reached CHF 43 million, up 10.5 percent, and Austria, which was
consolidated into the division's results for the first time,
contributed CHF 7.9 million. External sales at the division's Swiss
unit declined -1.2 percent, principally due to lower sales at the
Swiss kiosks. Valora Retail's reported net revenues rose by +1.3
percent between the two periods, reaching CHF 807.4 million. The
division's overall operating profit in the first six months of 2012
was CHF 13.5 million, versus CHF 19.2 million a year earlier.
Integration of the recently acquired companies is progressing
according to plan.

Valora Services The division remains adversely affected by the
persistent deterioration of the press market in Switzerland, Austria
and Luxembourg. Reported net revenues for the first six months of
2012 were CHF 258.8 million, CHF -51.5 million, or -16.6 percent,
lower than in the same period of 2011. Stripping out the effects of
the revenue contribution from Euro 2012 picture cards (CHF + 14.9
million) and negative exchange-rate effects (CHF -4.7 million), net
revenues contracted by CHF -61.6 million between the two periods, the
decline being attributable not only to lower press product sales, but
also to a reduction in the scale of the division's less profitable
wholesale activities. Valora Services first-half 2012 operating
profit was CHF 7.5 million, compared to CHF 10.0 million in the same
period of 2011.

Valora Trade Valora Trade generated net revenues of CHF 385.1 million
in the first half of 2012, a CHF +22.3 million increase on the first
six months of 2011. In local currency terms, net revenues rose +9.8
percent. In Sweden, the successful acquisition of the cosmetics
distributor ScanCo significantly contributed to this advance, while
the German and Austrian units were able to raise their sales by
signing up new principals. Valora Trade's expansion into new
categories also enabled it to improve its gross profit margin.
Although Valora Trade Switzerland succeeded in raising its net
revenues slightly on their first-half 2011 levels - despite the
effects of parallel imports and shopping tourism by Swiss consumers -
it was not able fully to offset the downward pressure on margins
caused by these two factors. Valora Trade's overall operating profit
for the first six months of 2012 was CHF 4.3 million, compared to CHF
7 million a year earlier.

Sale of Valora Services Austria reduces Group's dependence on press
market

Press sales, which have been in decline since 2011, also impinged on
the Services division's profitability. Valora's decision to sell its
Valora Services Austria subsidiary to its business partner Trunk
Service GmbH is a deliberate move aimed at reducing the Group's
dependence on the press market. The press distributor Hermann Trunk
GmbH & Co. KG, whose headquarters are in Munich, is already a
well-established player in the press distribution market, focusing on
the Greater Munich area, Upper Bavaria and the administrative region
of Swabia. The geographical area served by Valora Services Austria
ideally complements the area of Southern Germany in which the
purchaser currently operates, paving the way for expansion into
neighbouring markets. Under the terms of the contract, Trunk Service
GmbH will acquire 100% of the outstanding shares of Valora Services
Austria, and the firm will continue to employ the former Valora
employees on the same terms as before. In 2011, Valora Services
Austria generated some CHF 120 million in net revenues and an
operating profit of CHF 3.4 million. Both parties have agreed not to
disclose the purchase price of this transaction. The transaction will
be completed once the Bundeskartellamt, Germany's independent
competition authority, and the Austrian Competition Authority have
approved it.

Agreement signed for sale of Muttenz facility, generating financing
for future investments

A letter of intent relating to the sale of Valora's Muttenz facility
was signed on August 22, 2012. The parties have agreed not to
disclose the proposed purchase price. Valora's sale of this property
will enhance the financial flexibility available to the Group for the
further implementation of its business strategy. The Valora Group
will maintain its headquarters site in Muttenz, renting the
floorspace required.

The Group expects its sale of Valora Services Austria to generate a
book-value profit which would neutralise the effect of any potential
book-value loss on the sale of the Muttenz facility.

Outlook: focus on core areas of expertise with a view to
strengthening retail activities

Valora anticipates that conditions in the press market will remain
very challenging and that the decline in net press revenues can be
counteracted only through sales generated by other product ranges.
Discontinuation of press wholesaling in Austria will also help to
reduce the Group's dependence on the press market. Despite the CHF
1.20 floor which the Swiss National Bank has been upholding against
the euro since September 2011, the Swiss franc remains very strong
and the problems caused by the resulting parallel imports and
shopping tourism by Swiss consumers will continue. In order to
continue pursuing the measures initiated in recent years and to
adjust to changed market conditions, Valora will place greater
emphasis on its retail activities. These initiatives will involve:

- optimising the Group's format structures and outlet portfolios in
all its national markets - expanding the product range through the
addition of new and innovative items - further extending the agency
business model at k kiosk and P&B in Switzerland - streamlining
structures and processes in order to interact more closely with the
market and accelerate business growth - decentralising specific
support functions along country and format lines - shortening the
implementation schedules for the measures now being implemented -
increasing profitability by streamlining cost structures - further
acquisitions in retail formats with strong growth prospects

These measures are expected to produce their first positive effects
in the second half of 2012.

In the words of Rolando Benedick, Chairman of Valora's Board of
Directors and interim Group CEO, "We have already made substantial
achievements in the last four years. The measures we are taking now
will further strengthen our retail expertise across the Valora Group.
They underscore our vision of Valora as a lean retailer, focused on
our market and our customers, operating an outstanding outlet
network. We are confident that our costs will return to normal levels
in the second six months of 2012, and that our sale of Valora
Services Austria, our planned disposal of the Muttenz facility and
the new distribution of the emphasis placed on our various activities
will enable us to improve our profitability in the second half of
this year."

Valora Group key financial data

Income statement

in CHF million H1 2012 H1 2011

External sales 1 568.8 1 473.0
Adjusted* external sales 1 587.8 1 473.0
Net revenues 1 387.2 1 397.6
Adjusted* net revenues 1 397.5 1 397.6
Gross profit 441.7 429.6
Gross profit margin 31.8% 30.7%
Operating costs, net -419.3 -396.2
Operating profit (EBIT) 22.4 33.4
Adjusted* operating profit (EBIT) 20.5 33.4
EBIT margin 1.6% 2.4%
Adjusted* EBIT margin 1.5% 2.4%
Group net profit 15.1 26.3

* Adjusted for currency fluctuations and Euro 2012 picture cards

Liquidity, balance sheet

in CHF million 30.06.2012 31.12.2011
Cash and cash equivalents 122.3 109.6
Shareholders' equity 423.1 462.3
Equity cover 34.5% 41.9%
Net debt 218.8 41.0

Valora divisions' key financial data
Key metrics Retail Services Trade
in CHF million H1 2012 H1 2011 +/- H1 2012 H1 2011 +/- H1 2012 H1 2011 +/-
External sales 991.0 874.6 +13.3%
Adjusted* external
sales 007.3 874.6 +15.2%
Net revenues 807.4 797.4 +1.3% 258.8 310.3 -16.6% 385.1 362.9 +6.1%
Adjusted* net
revenues 815.1 797.4 +2.2% 248.6 310.3 -19.9% 398.6 362.9 +9.8%
Operating profit
(EBIT) 13.5 19.2 -29.4% 7.5 10.0 -24.8% 4.3 7.0 +38.2%
Adjusted* operating
profit (EBIT) 13.6 19.2 -29.2% 5.2 10.0 -47.7% 4.7 7.0 -33.7%
EBIT margin 1.7% 2.4% -0.7pP 2.9% 3.2% -0.3pP 1.1% 1.9% -0.8pP
Adjusted* EBIT margin 1.7% 2.4% -0.7pP 2.1% 3.2% -1.1pP 1.2% 1.9% -0.7pP

* Adjusted for currency fluctuations and Euro 2012 picture cards

The following documents are available on www.valora.com

Half-year report 2012 http://www.valora.com/media/documents/english/r
eports/2012/halbjahresbericht_2012_en.pdf

Press release
http://www.valora.com/en/media/newsinformation/news_00460.php

2012 half-year results presentation 2012 http://www.valora.com/media/
documents/english/presentations/2012/praes_halbjahresabschluss_2012_e
n.pdf

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Valora Telephone Conference - Half-Year Results 2012
Thursday, August 23 | 15:00 CET German, 16:00 CET English

Rolando Benedick, CEO of Valora Holding AG, Lorenzo Trezzini, CFO and
Andreas Berger, CEO Valora Retail, will provide information about the
Group's first-half 2012 results during a telephone conference. To
participate in the conference: call the following number (please call
10 to 15 minutes before the hour):

+41 (0) 91 610 56 00 (Europe)
+44 (0) 203 059 58 62 (UK)
+ 1 (1) 866 291 41 66 (USA - toll-free)

The playback will be available one hour after the conference on the
following homepage:
http://www.valora.com/en/investor/documents/multimedia/index.php

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Further inquiry note:
For further information on the above, please contact:

Media Relations: Phone: +41 61 467 36 31
Stefania Misteli E-mail: stefania.misteli@valora.com

Investor Relations: Phone: +41 61 467 36 50
Mladen Tomic E-mail: mladen.tomic@valora.com

end of announcement euro adhoc
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issuer: Valora Holding AG
Hofackerstrasse 40
CH-4132 Muttenz
phone: +41 61 467 20 20
FAX: +41 58 789 12 12
mail: info@valora.com
WWW: www.valora.com
sector: Retail
ISIN: CH0002088976
indexes:
stockmarkets: Main Standard: SIX Swiss Exchange, stock market: BX Berne eXchange
language: English