TRADING UPDATE Following unseasonably poor weather in May and most of June, which is now clear will impact consumer spending patterns in the summer months, Geest PLC anticipates that an area of business, its range of prepared side, convenience and leaf salads, will be adversely affected.

In the first four months of the year, the salads markets showed strong and consistent growth – for example, the market for bagged prepared leaf salads grew by 18-20 per cent each month.

However, by the end of May it was apparent that the poor weather had affected the rate of growth as the same category shrank by 12% in the month. This May was the coolest for five years with over double the rainfall and nearly 20% fewer sunshine hours than in the same month last year.

With an unsettled June nearing its close, it is now clear that the decline in sales has continued. Due to this weather-related effect on the salads markets, Geest expects to show a total interim operating profit similar to the first half of 2001, before accounting for £0.8m of profit on the sale of assets in 2002. It is likely that the recent poor weather will dampen consumer demand for salads during the rest of the Summer.

However, for the full year, the company expects to report a total operating profit not less than last year's.

Elsewhere in the UK fresh prepared foods market, Geest continues to achieve strong sales growth. In the first five months of the year, in the large categories of ready meals and pizza and in chilled bread, Geest increased its sales by 20%, 13% and 12% respectively. In the six months ended 30 June, Geest expects, therefore, to report an 8% rise in sales from its UK fresh prepared foods business overall - below the 12-13% growth it had established in the first four months.

Geest continues to make strong progress in its Continental European fresh prepared foods business, where current sales growth is above 25%, as well as in whole produce, where half year sales are expected to show a rise of over 60% following a once-off consolidation of supply.

Fresh prepared foods remains one of the fastest-growing categories of the UK food market. While the weather may impact this from time to time, changing demographics, consumer attitudes towards quality convenience foods, lifestyle and economic trends will continue to support the long-term demand for such products ensuring sustained growth in fresh prepared foods.

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