Weaker sales reduces expectations for 2016

Media Release 17 November 2016, 06.00 p.m.: Ad hoc announcement

Weaker sales reduces expectations for 2016

Sales fell organically by -1.6% in the first nine months of the year under review. The unexpectedly weak revenue growth to date in the fourth quarter reduced the amount forecast for the final quarter to an even lower figure. The current difficult market for the foodstuffs industry in Europe means that almost all of the sales divisions are affected by the weaker sales, also including our key account business due to the lower quantities ordered by key accounts. The substantial downturn in sales of around -10% for Hügli's own brands in the Consumer Brands division had a particularly negative impact. In addition, this division is also impacted by the dynamic changes in the sales channels and a major increase in competitive pressure. What is more, exchange rates also played a role, in particular the slump in the value of British pound, which had a negative income on the sales disclosed in Swiss francs.

As a result, we are forecasting sales to fall in 2016 by around -2%. As a result of the revenues of around EUR 12 million acquired in 2016 (+3.5%) by the new subsidiary, consolidated sales will still be slightly higher than the previous year's figure.

Despite our continued consistent cost management, the downturn in sales is putting pressure on our anticipated earnings. Our previous forecast for operating results was slightly lower than in the previous year with an EBIT margin for 2016 of almost 8.0% (2015: 8.1%). The Group's management is now forecasting an EBIT margin of a good 7%.

Growth drives have now been initiated in view of the unsatisfactory course of business. These are coupled with a review of additional potential for cutting costs - with the aim of returning profitability to the level defined in the strategy. We are confident that we will achieve this.

The detailed sales report for 2016 and indicators of the results will be published on
31 January 2017.

Financial information, information on corporate governance and on the Hügli share listed on the SIX Swiss Exchange (HUE / security no. 464795) can be retrieved from our Investor Relations website: http://www.huegli.com/en/investor-relations

For further information:

Andreas Seibold, CFO, Tel. [phone], [e-mail]

Hügli Holding AG, Bleichestrasse 31, CH-9323 Steinach

Hügli - Culinary expertise.Creativity.Speed.

Hügli was founded in Switzerland in 1935. Today, it is one of the leading European foodstuffs companies for the development, production and marketing of dry blends in the convenience segment such as soups, sauces, bouillons, ready to serve meals, desserts, functional food as well as ready to eat specialties.Hügli caters to the kitchens of the professional out of home market (Food Service), manufactures products for brand companies (Brand Solutions), as well as for food retailers (Private Label LEH). With its flavour-adding semi-finished products, Hügli partners with food manufacturers (Food Industry) and sells own brands, mostly of organic quality, to consumers (Consumer Brands).1'500 employees in 11 countries link Hügli directly with its customers, and generate annual sales of around CHF 380 million (EUR 350 million).

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