Massimo Zanetti Beverage Group S.p.A. announced consolidated earnings results for the first quarter ended March 31, 2018. For the quarter, the company reported revenue was €211,202,000 against €233,640,000 a year ago. EBITDA was €15,213,000 against €13,912,000 a year ago. Operating profit was €6,361,000 against €4,833,000 a year ago. Profit before tax was €4,238,000 against €3,809,000 a year ago. Profit for the period was €2,797,000 against €2,319,000 a year ago. Basic and diluted earnings per share were €0.08 against €0.07 a year ago. Net cash generated from operating activities was €6,882,000 against net cash used in operating activities of €4,263,000 a year ago. Purchase of property, plant and equipment was €5,740,000 against €7,808,000 a year ago. Purchase of intangible assets was €380,000 against €439,000 a year ago. The revenues were negatively affected by the FX fluctuation for €15.7 million, minus 6.7%. The free cash flow is positive €2.9 million. This compares with a negative figure of €10.1 million in first quarter 2017. The improvement of €13 million year-on-year is driven by lower cost absorption by the net working capital of €9.8 million and lower capex by €2.9 million. The reduction in CapEx of €2.1 million versus first quarter, 2017 is evenly split between the commercial CapEx, the industrial CapEx and asset under construction. Net debt amounting to €190.5 million is stable compared to €191.0 million at December 31, 2017.

For the quarter ended March 31, 2018, the company reported Impairment of €396,000 against €1,116,000 a year ago.

Confirming the 2018 outlook, in view of the results achieved in the first quarter and considering current trends, as well as assuming a substantial stability of exchange rates and the absence of extraordinary transactions in M&A, expectations relating to the group's performance for 2018 are as follows: An increase in revenues of approximately 2% to 4% as a consequence of the further improvement in the product and channel mix, which is one of key strategic objectives. An increase in EBITDA adjusted of approximately 5% to 8%, mainly driven by the positive impact on profits of the above channel product mix and a substantial stability of the group's ability to absorb its fixed costs, and a reduction in the net debt to below €180 million through the generation of cash flows from operating activities.