Beter Bed Holding N.V. — Earnings Release 2009

Mar 12, 2010

PRESS RELEASE

Uden, The Netherlands, 12 March 2010

Beter Bed: growth in revenue and profit continues

• Revenue increased by 0.8% to € 361.5 million for the full year 2009 despite shrinking market.
• Net profit for the full year 2009 totalled € 23.9 million, 8.1% higher than in 2008.
• Revenue once again higher in the fourth quarter of 2009 (+9.0%).
• Net profit in the fourth quarter of 2009 amounted to € 11.9 million (71.1% higher than the fourth quarter of 2008).
• Dividend proposal: € 1.04 per share (2008: € 0.52 per share); payout ratio of 93%.
• Despite the poor accessibility of German stores due to prolonged extreme winter weather conditions, the company expects to realise higher revenue with at least a 35% rise in net profit in the first quarter of 2010 compared to the first quarter of 2009.

(in million € unless stated otherwise)	2009	2008	Change
Revenue	361.5	358.6	+0.8%
EBIT	32.6	31.2	+4.6%
Net profit	23.9	22.1	+8.1%
Earnings per ordinary share (in €)	1.12	1.04	+7.7%
Solvency (%)	50.5	44.0

Key figures for full year

Dividend proposal (in €)	1.04	0.52	+100%

Key figures for fourth quarter

(in million €)	Q4 2009	Q4 2008	Change
Revenue	101.9	93.4	+9.0%
EBIT	15.7	9.6	+63.2%
Net profit	11.9	6.9	+71.1%

Ton Anbeek, CFO:

'The Beter Bed Holding formulas achieved growth in revenue in the fourth quarter of 2009 and for the full year 2009 in a market in which consumers were still reluctant. It was once again possible to achieve this growth in large part thanks to the commitment and professionalism of our employees. The introduction of new products featuring an excellent price-quality ratio and the promotional activities resulted in an increase in revenue. The measures aimed at improving gross profit and reducing the expenses per store once again contributed substantially to the result. We continue to invest in opening new stores. With respect to the dividend, we are able to announce that the amount will be doubled this time in comparison to 2008.'

Fourth quarter 2009

Revenue in the fourth quarter of 2009 totalled € 101.9 million, which represents a 9.0% increase in comparison to the fourth quarter of 2008 (€ 93.4 million). Revenue at comparable stores grew by 7.9% (fourth quarter 2008: -7.6%). Revenue performance per country in the fourth quarter was as follows:

• Netherlands 5%
• Germany 13%
• Austria 23%
• Switzerland 9%
• Spain -8%
• Belgium 27%
• Poland activities launched in December 2008

Gross profit in the fourth quarter of 2009 amounted to 56.7%, compared to 56.3% in the fourth quarter of 2008. Despite the opening of new stores, the operating expenses decreased from € 42.9 million to € 42.1 million. This meant the average expenses per store decreased by 5%. Operating profit (EBIT) totalled € 15.7 million (15.4% of revenue) in the fourth quarter of 2009, compared to € 9.6 million (10.3% of revenue) in the fourth quarter of 2008. Net profit rose to € 11.9 million (€ 6.9 million in the fourth quarter of 2008).

Full year 2009

Continuing its expansion policy, Beter Bed Holding was able to achieve full-year 2009 revenue growth of 0.8% to € 361.5 million, compared to € 358.6 million for the full year 2008. The company again increased its market share in 2009. Revenue at comparable stores decreased by 3.1% for the full year 2009 due to reluctant consumer spending. With the exception of Spain, the market conditions were less favourable in the course of the second quarter of 2009. Revenue performance by country was as follows for the Beter Bed Holding formulas:

• Netherlands -7%
• Germany 6%
• Austria 22%
• Switzerland 13%
• Spain -10%
• Belgium 61%
• Poland activities launched in December 2008

The company was able to realise lower purchase prices due to the decrease in raw material prices. This advantage has been largely passed on to the customers, which enabled revenue to once again rise from the third quarter of 2009 onward. Gross profit for the full year 2009 was nonetheless higher at 54.7%, compared to 54.5% in 2008. The number of stores increased by 28 from 1,036 at year-end 2008 to 1,064 at year-end 2009. Despite the growth in the number of stores, the operating expenses increased only fractionally from € 164.3 million in 2008 to € 165.2 million in 2009. The average expenses per store could once again be reduced by five percent for the full year 2009. This decrease was realised by closing poorly performing stores, making further efficiency improvements in the area of logistics, increasing the productivity of the central services and a stringent expenses policy.

Operating profit totalled € 32.6 million (9.0% of revenue) for the full year 2009, compared to € 31.2 million (8.7% of revenue) in 2008. The tax burden decreased from 27.1% for the full year 2008 to 25.2% for the full year 2009. Net profit amounted to € 23.9 million, compared to € 22.1 million in 2008. Earnings per share were € 1.12 in 2009 (2008: € 1.04).

Financial

Total investments in 2009 amounted to € 6.3 million (2008: € 10.0 million). The largest proportion of this amount, namely € 5.3 million, was once again invested in new and existing stores in 2009. The remaining amount was invested primarily in IT. The cash flow (net profit plus depreciation) amounted to € 31.7 million in 2009, compared to € 29.4 million in 2008. Solvency amounted to 50.5% at the end of 2009 (2008: 44.0%). A € 10 million loan was entered into in June 2009. This loan has a term of five years with a fixed interest rate of 4.75 and will be repaid monthly on a linear basis.

Interest-bearing debt amounted to € 9.0 million at year-end 2009 (year-end 2008: € 16.3 million).

Operational

A total of 97 stores were opened and 69 stores were closed in 2009. This meant that on balance a total of 28 stores were added, which brought the total number of stores at the end of 2009 to 1,064.

Number of stores	31-12-2008	Closed	Opened	31-12-2009
Matratzen Concord (incl. MAV)	857	54	80	883
Beter Bed	84	4	4	84
El Gigante del Colchón	50	8	9	51
BeddenREUS	33	3	4	34
Slaapgenoten/Dormaël Slaapkamers	12	-	-	12
Total	1,036	69	97	1,064

Matratzen Concord (incl. MAV)

Revenue of the Matratzen Concord cash & carry formula reached € 215.6 million (59.6% of total revenue) in 2009. This is up 7.0% from 2008, when revenue was € 201.4 million. Revenue at comparable stores fell 0.7%.

86% of the revenue of Matratzen Concord was realised in Germany in 2009.

This formula added 26 new stores on balance in 2009, of which ten are based in Germany. Five stores were added in Austria on balance and four in Switzerland. A net total of two new stores were opened in the Netherlands and three new stores were opened in Belgium. The first store was opened in Poland in December 2008 and another two were opened in 2009.

Number of stores	31-12-2008	Closed	Opened	31-12-2009
Germany	751	51	61	761
The Netherlands	30	2	4	32
Austria	41	1	6	46
Switzerland	30	-	4	34
Belgium	4	-	3	7
Poland	1	-	2	3
Total	857	54	80	883

Beter Bed

This formula operates in the Netherlands. With four openings and four closures, the number of Beter Bed stores remained the same at 84. Revenue decreased by 7.5% from € 116.1 million in 2008 to € 107.4 million in 2009. This meant that this formula contributed 29.7% to the total group revenue.

The decrease in revenue was concentrated in the first half of 2009. Revenue at comparable stores decreased by 3.9% for the full year 2009. Revenue at comparable stores also once again increased in the fourth quarter of 2009.

Other formulas

Revenue from other formulas was € 38.5 million in 2009. This includes the revenue of the store formulas BeddenREUS (the Netherlands), Slaapgenoten/Dormaël (the Netherlands), El Gigante del Colchón (Spain) and wholesaler DBC. Revenue was 6.2% lower in 2009 than in 2008. These other formulas contributed 10.7% to the total group revenue.

Dividend

An interim dividend of € 0.35 per share in cash was paid in November 2009.

Payment of a final dividend in cash of € 0.69 will be proposed to the Annual General Meeting of Shareholders to be held on 28 April 2010. This means the dividend for 2009 will amount to € 1.04 per share (2008: € 0.52 per share) and 93% of the net profit will be paid out to the shareholders.

Auditor's report

The financial information in the appendices is derived from the consolidated financial statements of Beter Bed Holding N.V., which will be presented for adoption to the Annual General Meeting of Shareholders on 28 April 2010 and on which an unqualified auditor's report has been issued.

Developments in the first months of 2010 and outlook

Despite the extreme winter weather conditions, which in particular meant that an extremely large number of Matratzen Concord stores in Germany were either inaccessible or difficult to access for a number of weeks, the company expects to realise growth in profit of at least 35% with higher revenue in the first quarter of 2010 compared to the first quarter of 2009.

Profile

Beter Bed operates in the European bedroom furnishings market. Its activities include retail trade through a total of approximately 1,064 stores that operate via the chains Beter Bed (active in the Netherlands), Matratzen Concord (active in Germany, the Netherlands, Austria, Switzerland, Belgium and Poland), El Gigante del Colchón (active in Spain), BeddenREUS, Dormaël and Slaapgenoten (all three active in the Netherlands) and MAV (active in Germany). Beter Bed Holding is also active in the field of developing and wholesaling branded products in the bedroom furnishings sector in the Netherlands, Belgium, Germany and Spain via its subsidiary DBC International. Beter Bed Holding achieved net revenue of € 361.5 million in 2009. The company has been listed on Euronext Amsterdam since December 1996. The Beter Bed Holding share is included in the Amsterdam Small Cap Index.

Financial Calendar

28 April 2010	Publication of results 1st quarter 2010
28 April 2010	Annual General Meeting of Shareholders
16 July 2010	Publication of Q2 2010 trading statement
27 August 2010	Publication of half-year results 2010
27 August 2010	Analysts' meeting half-year results 2010
29 October 2010	Publication of results 3rd quarter 2010
21 January 2011	Publication of Q4 2010 trading statement

APPENDICES:

• Consolidated profit and loss account
• Consolidated balance sheet
• Consolidated cash flow statement
• Consolidated equity movements overview

For more information, please contact: Ton Anbeek, Chief Executive Officer Tel. +31 (0)413 338819 / Fax +31 (0)413 338829 / Mob. +31 (0)6 53662838 E-mail: ton.anbeek@beterbed.nl / Website: www.beterbedholding.com

Consolidated profit and loss statement

(* EUR 1.000)

Fourth quarter		Cumulative
2009	2008		2009	2008
101.857	93.411	Revenue	361.470	358.565
(44.075)	(40.854)	Cost of sales	(163.638)	(163.079)
57.782	52.557	Gross profit	197.832	195.486
56,7%	56,3%		54,7%	54,5%
20.148	20.392	Wage and salary costs	78.238	78.089
1.945	1.927	Depreciation of tangible fixed assets	7.750	7.309
19.995	20.624	Other operating expenses	79.206	78.880
(42.088)	(42.943)	Total operating expenses	(165.194)	(164.278)
-41,3%	-46,0%		-45,7%	-45,8%
15.694	9.614	Operating profit (EBIT)	32.638	31.208
15,4%	10,3%		9,0%	8,7%
(158)	(187)	Financial income and expenses	(660)	(864)
15.536	9.427	Profit before taxation	31.978	30.344
(3.648)	(2.480)	Income tax expense	(8.060)	(8.218)
11.888	6.947	Net profit	23.918	22.126
11,7%	7,4%		6,6%	6,2%
0,55	0,33	Earnings per share in €	1,12	1,04
0,56	0,32	Diluted earnings per share in €	1,12	1,03

Consolidated balance sheet

(* EUR 1.000)	31-12-2009	31-12-2008
Fixed assets	29.663	31.940
Intangible fixed assets	3.811	3.811
Financial fixed assets	1.038	528
Stocks	51.467	49.393
Debtors	5.942	6.110
Cash and cash equivalents	17.156	5.196
TOTAL ASSETS	109.077	96.978
Equity attributable to equity holders of the parent	55.052	42.703
Long-term liabilities	8.816	1.748
Credit institutions	2.000	16.337
Current liabilities	43.209	36.190
TOTAL LIABILITIES	109.077	96.978

Consolidated cash flow statement

(* EUR 1.000)

		Cumulative
	2009		2008
Cash flow from operating activities
Operating result	32.638		31.208
Financial income received	67		16
Financial expenses paid	(727)		(880)
Income taxes paid	(6.772)		(9.800)
Depreciation	7.750		7.309
Costs employee stock options	247		557
Movements in:
Stocks	(2.074)		370
Debtors	168		(772)
Short term liabilities	5.334		2.963
Other	7		120
		36.638		30.971
Cash flow from investing activities
Additions to tangible fixed assets	(6.331)		(10.029)
Disposals of tangible fixed assets	683		488
		(5.648)		(9.541)
Cash flow from financing activities
Drawing of loan	10.000		-
Repayment of loan	(1.000)		-
Income from the issue of shares	664		74
Dividend paid	(12.357)		(21.064)
Share buy-back program	-		(4.196)
		(2.693)		(25.186)
Movements in cash and cash equivalents		28.297		(3.756)
Cash and cash equivalents at the start of the financial year		(11.141)		(7.505)
Cash and cash equivalents at the end of the financial year		17.156		(11.261)

Consolidated overview of movements equity

(* EUR 1.000)				Reserve for
		Issued share	Share premium	currency translation	Revaluation	Other	Retained
	Total	capital	reserve	differences	reserve	reserves	earnings
Balance on 1 January 2008	45.066	436	16.145	(10)	2.852	(1.929)	27.572
Net profit for 2008	22.126	-	-	-	-	-	22.126
Other components of comprehensive Income 2008	140	-	-	140	-	-	-
Profit appropiation 2007	(14.894)	-	-	-	-	12.678	(27.572)
Interim dividend 2008	(6.170)	-	-	-	-	(6.170)	-
Share buy-back program	(4.196)	-	-	-	-	(4.196)	-
Issue of shares	74	-	-	-	-	74	-
Costs of employee stock options	557	-	-	-	-	557	-
Balance on 31 December 2008	42.703	436	16.145	130	2.852	1.014	22.126
Net profit for 2009	23.918	-	-	-	-	-	23.918
Other components of comprehensive Income 2009	(123)	-	-	7	(130)	-	-
Profit appropiation 2008	(4.897)	-	-	-	-	17.229	(22.126)
Interim dividend 2009	(7.460)	-	-	-	-	(7.460)	-
Issue of shares	664	-	-	-	-	664	-
Costs of employee stock options	247	-	-	-	-	247	-
Balance on 31 December 2009	55.052	436	16.145	137	2.722	11.694	23.918