Final results for 53 weeks

2 October 2012

Produce Investments plc

Final results for 53 weeks ended 30 June 2012

Produce Investments plc ("Produce Investments" or the "Group") (AIM:PIL), a leading operator in the fresh potato sector with vertically integrated activities covering seed production, own growing, processing and packing and supply to the major retailers, is pleased to announce its results for the 53 weeks ended 30 June 2012.

(1) Before exceptional costs associated with equity raising and listing

Operational Highlights

·; Lower turnover as a consequence of the low priced potato season

·; Improvement in operating margins

·; Launch of own brand - Greenvale Farm Fresh

·; Improvement in earnings per share

Post Reporting Period

·; Acquisition of Rowe Farming Limited

For further information contact:

Produce Investments plc

Brian Macdonald, Finance Director 01890 819503

Shore Capital & Corporate Limited (Nomad)

Stephane Auton/Patrick Castle 0207 408 4062

Hudson Sandler

Nick Lyon 0207 796 4133

Note to Editors

The Group is a vertically integrated company supplying blue chip customers such as Tesco, Sainsbury and Bakkavor with fresh and processed potatoes.

Website: www.produceinvestments.co.uk

CHAIRMAN'S STATEMENT

I am pleased to report to shareholders that the Group has performed well in the year ended 30 June 2012. The sizeable UK crop harvest in 2011, which was in excess of 6 million tonnes, resulted in a relatively low priced year for potatoes for most of the year. The low priced season, coupled with a fiercely competitive retail environment put pressure on selling prices with traded volumes on behalf of our growers particularly affected. As a result total Group turnover reduced by 10.2% but I am pleased to say that despite this reduction in turnover, operating profit margins increased to 4.5% from 3.8%, resulting in a pre-tax profit before exceptional charges of £6.0m (2011: £5.3m).

Looking ahead, the wettest spring and summer in over 100 years is impacting crop production very significantly and is likely to impact the Group's performance in the year ahead. The Group's procurement model which fixes a large element of crop in advance of the season will partly mitigate some of this increase. However, it is likely that trading will be impacted and, therefore, the Directors believe that it is prudent to reduce the level of the final dividend compared to last year to 1.82 pence per share (2011:3.64 pence), which combined with the interim dividend of 1.82 pence per share (2011:1.82 pence) results in a total dividend for the year of 3.64 pence per share (2011:5.46 pence). The final dividend will be paid on 30 October 2012 to ordinary shareholders on the register at close of business on 5 October 2012.

I would also like to express my sincere thanks to all employees of the Group who have helped to contribute to these excellent results for the year.

Also today, 2nd October 2012, the Company announced the acquisition of the share capital of Rowe Farming Limited. The consideration for the acquisition comprises a cash payment of £12.3m and the issue of 1,818,182 new ordinary shares in Produce Investments. The cash consideration is being funded through the Company's existing cash resources and a new bank facility with HSBC.

I am delighted we have been able to purchase such a high quality business. It takes the Company into new sectors and we are both excited and confident about the future earnings potential. This transaction was strongly supported by our major shareholder and we look forward to repaying the faith shown in us as we start to deliver on our long term strategy of growing the business through acquisition and diversifying its earnings profile both in terms of its customer base and its product offering. The Directors will continue to seek similarly attractive acquisitions and remain confident in our ability to grow the business substantially over the next few years.

Barrie Clapham

Non-Executive Chairman

In the year ended 30 June 2012, we saw for most of the year a relatively low priced potato season, largely as a result of a large potato crop which was in excess of 6 million tonnes. The Group's procurement model, which is based on sustainable fixed price procurement contracts with its grower base, meant that the Group was not able to take full advantage of the relatively low farm gate prices. The low priced season, along with a very competitive retail environment fuelled by excessive promotional activity, put considerable deflationary pressure on selling prices. Traded volumes sold on behalf of growers direct to third party customers were also negatively impacted. The low priced season also placed pricing pressure on our processing, food service and seed business with turnover and margins impacted.

Largely as a result of the low priced season total Group turnover was £153.9m, a decrease of 10.2% when compared with £171.4m last year. Despite this reduction in turnover, operating profit before exceptional charges increased to £6.9m from £6.4m, an increase of 6.7%, with operating margins improving from 3.8% to 4.5%.

Adjusted earnings per share for the year amounted to 24.45 pence per share, a 15.9% gain on the prior year (21.10 pence). Adjusted diluted earnings per share for the year amounted to 22.80 pence per share, a 14.6% gain on the prior year (19.89 pence).

During the year the Group successfully launched its first branded potato into the retail sector with "Greenvale Farm Fresh". This brings together a unique packaging concept and a great tasting variety, and whilst it is relatively early days, initial feedback and sales are very encouraging with clear evidence of the brand bringing new customers into the category.

The Group continues to be strongly cash generative and at the year end total net debt stands at £4.3m compared with £8.1m last year.

As the Chairman noted, in 2012 the wettest spring and summer in over 100 years is impacting crop production quite significantly. This is likely to result in a lower than average UK yielding crop, which will lead to higher than average prices. The Group's procurement model which fixes a large element of crop in advance of the season will partly mitigate some of this increase but crop failures, yield reduction and high waste will be more prominent than seen in recent years and is expected to impact Group performance in the year ahead.

The Board is very excited by the acquisition of Rowe Farming Limited (RF). RF's business is based in Cornwall, in the South West of England and they operate from a number of sites in the area. RF have built a very successful business model over many years growing and supplying predominantly specialist new and salad potatoes, with a particular focus on the high value "first early" part of the season. In addition to potatoes, RF also grow and supply daffodils and daffodil bulbs for both domestic and export markets, including the multiple retail sector in the UK.

The Board remains confident that Produce Investments is well positioned to both grow organically and to take advantage of any acquisition opportunities.

Angus Armstrong

Chief Executive Officer

CONSOLIDATED INCOME STATEMENT

For the 53 weeks ended 30 June 2012

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the 53 weeks ended 30 June 2012

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 June 2012

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the 53 weeks ended 30 June 2012

CONSOLIDATED CASH FLOW STATEMENT

For the 53 weeks ended 30 June 2012

Notes

1. Statement of compliance

The Group's financial statement have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union as they apply to the financial statements of the Group for the period ended 30 June 2012 and applied in accordance with the Companies Act 2006. The financial information set out above does not constitute the Company's statutory report and accounts for the years ended 30 June 2012 or the year ended 25 June 2011, but is derived from those accounts. Statutory accounts for 2011 have been delivered to the registrar of companies, and those for 2012 will be delivered in due course. The auditor has reported on those accounts; their reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The annual report and accounts for the year ended 30 June 2012 will be posted to shareholders on 2 October 2012. The results for the year ended 30 June 2012 were approved by the Board of Directors on 2 October 2012 and are audited.

The information contained in this preliminary announcement has been approved by the Board of Directors.

2. Basis of preparation

The financial statements have been prepared on a historical cost basis, except for derivative financial instruments and biological assets, which have both been measured at fair value in line with applicable accounting standards.

3. Earnings Per Share

Adjusted earnings per share is included to enable earnings to be produced on a directly comparable basis. To achieve this comparison, the operating profit for the 52 weeks to 25 June 2011 is reflected as if the exceptional items had not been included in the income statement. This increased underlying profit by £2,768,000. An underlying effective tax rate of 22% has then been applied to the adjusted profit.

4. Report distribution

Copies of the annual report and financial statements will be sent to shareholders shortly and will be available for a period of one month to the public at the offices of Produce Investments plc, Floods Ferry, Floods Ferry Road, Doddington, March, Cambridge, PE15 OUW, and at the Company's website.