MUSGRAVE GROUP RESULTS YEAR ENDED 31 DECEMBER 2006

16 May 2007

Musgrave Group, partner to entrepreneurial food retailers and food service professionals in Ireland, Northern Ireland, Great Britain and Spain, today 16 May 2007 announces its eighth year of consecutive profit growth for the year ended 31 December 2006.

Musgrave Group Financial Performance

In 2006, Musgrave Group achieved the following:

• Turnover of €4.6 billion, up 4.5% of which €4.1 billion is attributed to retail brands and €0.5 billion to cash and carry and foodservice;
• Profit before tax of €81.0 million up 14.2%;
• Net debt reduced by €139 million to €186 million;
• Eight years of successive profit growth delivering a compound annual increase in profit before tax of 17%.

Commenting on today’s announcement, Mr. Chris Martin, Musgrave Group Chief Executive said: “In 2006, Musgrave Group achieved its eighth consecutive year of turnover and profit growth, delivered by the Group and its partners responding to consumer needs.

”The investment in our brands, together with the approach of our entrepreneurial retail partners working and living in the communities in which they operate is generating sales growth in all our markets. We have had a good start to 2007 and as our brands continue to expand, we expect to see further solid growth in the year ahead.”

Musgrave Retail Brands

We support more than 3000 stores across 8 retail brands. Last year our retail partners, who own their own stores, achieved turnover of €6.7 billion up 7% on 2005. This performance was delivered by meeting the changing needs of modern consumers and by providing them with real choice in fresh foods, convenience, value added services and value for money.

Republic of Ireland
• Combined retail sales of €3.4 billion in an overall grocery market estimated to be worth between €13 billion and €14 billion.
• Of this, SuperValu retailers recorded sales in excess of €2 billion up 11%, with like for like sales growth of 6%.
• Centra retailer sales were €1.2 billion, up 17% with like for like sales growth of 8%.
• Opened 11 new SuperValu stores, 47 new Centra stores and 46 new Daybreak stores.

Northern Ireland
• In Northern Ireland, total retail sales of €556 million up 9% on 2005 were delivered through SuperValu, Centra and DayToday.

Great Britain
• Budgens and Londis retail partners recorded robust retail sales of €2.6 billion.
• The strategy to sell company-owned Budgens stores to independent retailers continues apace with 59 stores sold in 2006. Budgens independent stores recorded sales growth of 88% and 5% like for like sales growth.
• Londis achieved like for like sales growth of 4%.

Spain
• Dialprix and SuperValu retailers operating in the Alicante region of south east Spain recorded 8% sales growth to €113 million.

Investment in Ireland in 2006

Our retail partners supported by Musgrave are at the heart of communities throughout Ireland. Together we have invested heavily in local economies throughout Ireland and as a result have made a meaningful contribution to the national economy. This relentless focus on providing choice to consumers while supporting and investing in communities has driven the business forward during 2006.

• We have created more than 2,000 new jobs in towns and communities across the Country. Our combined employment in Ireland is now more than 24,000.

• We have invested in excess of €160 million in existing and new retail developments across the Country. In the Republic of Ireland this included the opening of 47 new Centra stores, the revamp of a further 64 and the opening of the 400th Centra store on Parnell Street, Dublin. In addition, 2006 saw SuperValu exceed €2 billion in retail sales for the first time while at the same time opening 11 new stores and revamping 16.

• We opened the first dedicated Foodservice cash and carry in Ireland with plans to roll out others across the country.

• Musgrave and its retail partners invested in excess of €5.4 million in local and national sponsorships, initiatives and charitable causes in 2006 including sponsoring the National Tidy Towns in Ireland now in its sixteenth year and renewed for a further 5 years, SuperValu Kids In Action, as well as ongoing support to Our Lady''''s Hospital for Sick Children Crumlin and the Irish Cancer Society.

• We are working to reduce our environmental impact. In a significant step towards becoming carbon-neutral, we completed a green electricity deal with Energia with the result that all of our warehouses and office facilities in the Republic of Ireland will save in excess of 13,500 tonnes of C02 emissions during 2007. The Group also exceeded its 65% waste recycling target in 2006 in both the Republic of Ireland and Northern Ireland by diverting 16,600 tonnes of waste into recycling and away from landfill.

• Significant investment was also made in supporting indigenous Irish producers. In the Republic of Ireland 75% of all products sold in SuperValu and Centra stores is sourced or manufactured in Ireland worth €2.4 billion at retail level.

Outlook

Commenting on the outlook for the Group in 2007, Chris Martin said: “For 2007, we expect to see further solid growth. The Group is focusing on innovation, making further enhancements to the retail brands while reducing costs without compromising quality.

The Group and its retail partners in Ireland will invest in excess of €180 million in new stores and in the development of existing stores and infrastructure to meet anticipated consumer demand.

In other markets we are witnessing the growing success of our model. In Great Britain, this is illustrated by the speed of the sale of the company-owned Budgens stores to independent retailers who are attracted by our business model.

In 2007, in Northern Ireland we will be developing and strengthening our brands through expanded product ranges and new lines while in Spain we will be looking to increase our presence in the high population growth areas of Valencia and Murcia.

Our strategy is to partner with entrepreneurial retailers to ensure we continue to anticipate and meet diverse and changing consumer demands. We will continue to expand our business by adding new stores in our core markets ensuring that convenience, value and fresh local produce is at the heart of everything we do. While we are operating in highly competitive markets we look forward to the coming year with confidence.”

Ends

For further information please contact:

Edelman: 01 6789333
Joe Carmody: 086 8058764
Mark Cahalane: 087 2302737

Edel Clancy
Musgrave
Group Director of Communications
021 452 2123/086 8523998

Notes to editor

About Musgrave
The Musgrave Group is partner to entrepreneurial food retailers and foodservice professionals in Ireland, the UK and Spain. The company was founded in Cork in 1876 by brothers Thomas and Stuart Musgrave, and is now Ireland’s biggest food and grocery distributor. In the UK, Musgrave Group acquired the Budgens chain of convenience stores in 2002 and bought the Londis franchise in 2004. It now serves more than 3,000 stores in Ireland, the UK and Spain. In 2006 Group sales were €4.5 billion and Group retail turnover was €6.7 billion.

SuperValu and Centra – the leading network of supermarkets and convenience stores in the Republic of Ireland and Northern Ireland. The network comprises a total of 708 outlets which are owned by progressive independent food retailers.

Budgens and Londis – in Britain there are 74 company owned Budgens stores, 108 independently owned Budgens stores and in excess of 1,900 independently owned Londis stores. It is planned that all Budgens corporate stores will be in independent ownership by 2008.

DayToday and Daybreak – two chains of independently owned convenience stores in both the Republic of Ireland and Northern Ireland. The Group currently partners retailers in 172 DayToday stores and 94 Daybreak stores.

Musgrave Cash & Carry – provides delivered retail and cash & carry services to more than 34,000 customers from nine depots in both the Republic of Ireland and Northern Ireland.

Musgrave Foodservices – the first company offering a full multi-temperature range of products for the professional caterer across the 32 counties of Ireland.

Dialsur, SuperValu, Dialprix and Dicost – the Group’s Spanish operation of convenience stores as well as cash & carry outlets.

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