Virbac — Earnings Release 2012

Oct 18, 2012

STEADY GROWTH OF SALES IN THE THIRD QUARTER

Public release – October 18th, 2012

Virbac consolidated sales in the third quarter reached 179.0 M€, a +11.2% change compared to the same period of 2011. Sales increased by +6.8% excluding favourable exchange rates impacts and +6.1% at constant scope.

Virbac's growth during this quarter has been quite similar to the first half of the year in almost all regions: a high level of growth in the US, in Latin America and Asia; a positive trend in Australia after the low start of the year; a very dynamic activity in the UK and stability in other countries of Northern Europe. On the opposite, two factors unfavourably impacted the overall quarterly performance: on one hand growth has been modest this quarter in Southern Europe, a region which benefited in the first half from the very high positive impact of the launch of CaniLeish; on the other hand sales in France decreased compared to last year, essentially due to the new commercial policy aiming at splitting deliveries to wholesalers over a certain period to avoid peaks linked to the anticipation of tariff increases in October. Such measures had an impact of a few million Euros on the quarter.

Sales from the Stockguard acquisition in New Zealand have been recorded as from July and amounted to 2.9 M€ in this quarter, perfectly in line with expectations.

With total year-to-date sales of 528.4 M€ compared to 475.5 M€ last year, Virbac records a +11.1% total growth. Excluding the impact of favourable exchange rates, acquisitions (New Zealand) and divestments (distribution in specialized channels in Europe), organic growth reaches +8.2%.

Business trend by species over 9 months is similar to the first half. The companion animals segment enjoys a high level of organic growth, +11.9%, firstly driven by the United States with the strong increase of Iverhart but also the entire range, and by Southern Europe with the launch of CaniLeish. The growth in the food producing animals segment reaches +3.0%, again thanks to a high level of activity in the emerging countries, partially offset by a decrease in Europe in a sluggish market.

Consolidated numbers Unaudited - in million Euros	2012	2011	% change	Evolution at constant exchange rates	Evolution at constant scope and exchange rates
Net sales - $1st$ quarter	176.4	159.9	$+10.3%$	$+8.8%$	$+8.6%$
Net sales - 2 nd quarter	173.0	154.6	$+11.9%$	$+9.1%$	$+9.8%$
Net sales - 3d quarter	179.0	161.0	$+11.2%$	$+6.8%$	$+6.1%$
Net sales - year-to-date	528.4	475.5	$+11.1%$	$+8.2%$	$+8.2%$