São Paulo, March 26, 2008 - LAEP Investments Ltd produces, processes, sells and distributes milk and dairy products, and to capitalize on its structure also produces and distributes cookies, cakes, juices and teas. LAEP has a nationwide presence and sells under well known brands in Brazil?s milk industry, such as “Parmalat”, “Glória”, “Alimba”, “Lacesa”, ”Kidlat”, “Lady” and “Ibituruna”.
4Q07 HIGHLIGHTS AND SUBSEQUENT EVENTS
Initial Public Offering - On October 31, 2007, shares in LAEP Investments Ltd. began trading on the São Paulo Stock Exchange (Bovespa) in the form of BDRs. The Company raised R$507,611,107.50 from the primary offering of 67,681,481 shares.
Milk Crisis – Brazil suffered a milk confidence crisis between October 22 and November 11, 2007, when the Brazilian Federal Police launched an operation against milk cooperatives that allegedly sold adulterated milk. The operation began with tests based on milk ash, requested by the Federal Police, even though such tests are not recommended by the Ministry of Agriculture for the purpose of evaluating the quality of UHT milk. As a result, inconclusive reports were made public, impacting the general public‟ confidence in long shelf-life milk. The episode, which had an adverse affect on the Company‟ results as well as on its IPO, resulted in a 10% decline in Parmalat milk sales in November. However, the Company considers this an isolated case that will not affect the future course of its business, thanks to consumer confidence in the Parmalat brand, as revealed by a survey conducted by Instituto Data Folha. Further proof of this is the fact that sales have picked up as of December. We also believe that the impact of this crisis on the image of milk has waned, with no significant pressure on demand expected in 2008.