Downloard press release (pdf).

Highlights of Q4 2006

• Group sales rose 36.4% year-on-year to US$509.5 million
• Gross profit increased 51.0% year-on-year to US$164.6 million, with gross margins rising to 32.3% from 29.2%
• Operating income rose 63.1% to US$42.6 million
• Net income grew more than three-fold to US$29.2 million
• EBITDA [1] grew 45.4% to US$58.9 million

Highlights for full-year 2006

• Group sales rose 26.4% year-on-year to US$1,762.1 million
• Gross profit increased 43.6% year-on-year to US$568.0 million, with gross margins rising to 32.2% from 28.4%
• Underlying* operating income for the full year almost doubled to US$171.9 million, while reported operating income for the period, including special charges, increased 77.9% to US$155.6 million
• Underlying net income for the full year more than tripled US$108.5, while reported net income for the full year, including special charges, increased to US$95.4 million from US$30.3 million in 2005
• Underlying EBITDA for the full year increased 66.2% to US$234.3, while reported EBITDA for the full year, including special charges, improved 54.7% to US$218.0 million
• Operating cash flow increased 46.8% to US$167.3 million for full-year 2006

Commenting on the results, Tony Maher, chief executive officer of Wimm-Bill-Dann Foods OJSC, said: "It has been one year since I joined Wimm-Bill-Dann and I am very pleased to mark the occasion with the announcement of another strong financial performance during the fourth quarter and full-year 2006. Group sales increased 36% year-on-year in the fourth quarter and 26% for the full year. Underlying EBITDA increased 45% in the quarter and 66% for the full year.

In the second quarter of last year, we embarked on a journey of optimizing our cost base, enhancing our route to market, investing in building consumer preferences in our brands and strengthening our management team.

[1] Note: See Attachment A for definitions of EBITDA and EBITDA margin and reconciliations to net income.
* Underlying term here and after means that numbers do not include the impact of special charges.

Though this journey is in its early stages we are seeing encouraging indications that we are on the right track. Going forward we will continue to accelerate the pace of our progress towards being the largest food and beverage company in Russia and the CIS with the leading position in Health and Wellness".

 Table A. Key Financial Indicators for Q4 and FY 2006 Excluding Special Charges

Table B. Impact of Special Charges on Group’s Operating Results for FY 2006 

In May 2006 the Company initiated an in-depth review of all business units to assess how appropriate and efficient the infrastructure is going forward. This review led to a one time impairment charge of US$16.3 million to the Company’s P&L partially to cover the writing down of Valdai mineral water facility in Beverages and the closing off of a small dairy plant in Novokuibyshevsk in Dairy.

Dairy

Sales in the Dairy Segment increased 43.9% to US$392.4 million in the fourth quarter of 2006 from US$272.6 million in the fourth quarter of 2005. Organic growth amounted to US$96.8 million, while new acquisitions contributed an additional US$23.0 million to the overall sales growth in the Segment in the fourth quarter. Top-line growth was driven by a healthy balance between volume and price. The average dollar selling price rose 14.8% to US$0.98 per kg in the fourth quarter of 2006 from US$0.85 per kg in the fourth quarter of 2005. This increase was driven by favorable sales mix, average ruble price growth and, exchange rate effect. The gross margin in the Dairy Segment increased to 29.8% from 25.9% due to improved sales mix and the rise in average selling price outstripping the rise in raw milk prices, which grew 6.9% year-on-year in dollar terms.

Beverages

Sales in the Beverages Segment increased 7.8% to US$82.6 million in the fourth quarter of 2006 from US$76.7 million in the fourth quarter of 2005, driven by both growth in the average selling price and currency exchange rate effects. The average selling price increased 14.1% to US$0.78 per liter in the fourth quarter of 2006 from US$0.68 per liter in the same period of 2005. This was due to ruble price growth and positive exchange rate effect offsetting the higher share of lower-priced brands in the sales mix. The gross margin in the Beverages Segment was sustained at 38.0% in the fourth quarter of 2006, the same level as fourth quarter of 2005.

Baby Food

Sales in the Baby Food Segment increased 42.8% to US$34.5 million in the fourth quarter of 2006 from US$24.2 million in the fourth quarter of 2005. This was driven primarily by volume growth, as Russia’s baby food market continues to grow rapidly in both value terms and geographic reach. The average selling price rose 17.9% to US$1.82 per kg in the fourth quarter of 2006 from US$1.55 per kg in the fourth quarter of 2005 due to positive currency exchange rate effect, favorable sales mix and an increase in the ruble price. Driven by these factors, the gross margin in the Baby Food Segment increased to 47.4% from 37.8% year-on-year in the fourth quarter of 2006.

Key Cost Elements

Selling and distribution expenses in the fourth quarter of 2006 grew as a percentage of sales to 15.9% from 13.5% year-on-year mainly due to increased advertising, transportation, and personnel expenses, an expected result of enhancing the route to market. General and administrative expenses decreased as a percentage of sales to 6.8% from 8.4% in the quarter.

The operating margin rose to 8.4% from 7.0% year-on-year in the fourth quarter of 2006, and underlying operating margin for the full year increased to 9.8% in 2006 from 6.3% in 2005. The Group’s GAAP reported operating margin including US$16.3 million in special charges (as shown in Table B) increased to 8.8% for the full year 2006, compared to 6.3% in 2005.

EBITDA margin increased to 11.6% from 10.8% year-on-year in the fourth quarter, while underlying EBITDA margin for the full year improved to 13.3% from 10.1% year-on-year. Reported EBITDA margin, including special charges, grew to 12.4% for the full year 2006 from 10.1% in 2005.

Financial expenses during the fourth quarter of 2006 decreased 25.1% to US$5.2 million compared to US$7.0 million in the same period of 2005. This was mainly the result of a foreign currency translation gainand additional interest income.

The Group’s income tax expenses totalled US$41.6 million for the full year 2006, compared to US$30.7 million in 2005. At the same time the effective tax rate declined to 29.7% from 47.5% year-on-year for the full year 2006. This sharp decline was driven by an increase in taxable profits accompanied by a decrease in the group’s non-deductible expenses in the fourth quarter and for the full year 2006, compared to the same periods in 2005.

Net Income

Net income increased 242.6% to US$29.2 million in the fourth quarter of 2006 compared to US$8.5 million in the fourth quarter of 2005. For the full year 2006, underlying net income improved more than three-fold to US$108.5 million from US$30.3 million in the same period of 2005. GAAP reported net income, which was impacted by US$13.1 million special charges, more than tripled to US$95.4 million for the full year 2006.

Attachment A
Reconciliation of EBITDA and EBITDA margin to US GAAP Net Income
EBITDA is a non-U.S. GAAP financial measure. The following table presents reconciliation of EBITDA to net income (and EBITDA margin to net income as a percentage of sales), the most directly comparable U.S. GAAP financial measure.

EBITDA represents net income before interest, income taxes and depreciation and amortization, adjusted for interest income, currency remeasurement gains, bank charges and other financial expenses and minority interest. EBITDA margin is EBITDA expressed as a percentage of sales.

We present EBITDA because we consider it an important supplemental measure of our operating performance.In particular, we believe EBITDA provides useful information to securities analysts, investors and other interested parties because it is used in the “debt to EBITDA” debt incurrence financial measurement in certain of our financing arrangements.

EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as substitute for analysis of our operating results as reported under U.S. GAAP.Moreover, other companies in our industry may calculate EBITDA differently or may use it for different purposes than we do, limiting its usefulness as a comparative measure.

EBITDA also should not be considered as an alternative to cash flow from operating activities or as a measure of our liquidity.In particular, EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business.

WIMM-BILL-DANN FOODS

Condensed Consolidated Statements of Operations and
Comprehensive Income

 (Amounts in thousands of U.S. dollars, except share and per share data)

 WIMM-BILL-DANN FOODS

 Consolidated Balance Sheets

(Amounts in thousands of U.S. dollars)

WIMM-BILL-DANN FOODS

 Condensed Consolidated Balance Sheets
(continued) 

			2006	December 31, 2005
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable			$104,066	$65,780
Advances received			13,230	5,291
Short-term loans			123,849	19,554
Long-term loans, current portion			4,137	3,823
Notes payable			-	49,794
Taxes payable			9,494	13,406
Accrued liabilities			37,103	17,071
Government grants – current portion			1,422	2,174
Other payables			37,035	30,200
Total current liabilities from continuing operations			330,336	207,093
Long-term liabilities:
	Long-term loans		30,082	1,824
	Long-term notes payable		248,742	254,230
	Other long-term payables		20,905	26,893
	Government grants – long-term portion		1,125	3,219
	Deferred taxes – long-term portion		28,275	15,636
Total long-term liabilities from continuing operations			329,129	301,802
Total liabilities			659,465	508,895
Minority interest			18,977	24,619
Shareholders’ equity:
		Common stock: 44,000,000 shares authorized, issued and outstanding with a par value of 20 rubles at December 31, 2006 and 2005	29,908	29,908
		Share premium account	164,132	164,132
		Accumulated other comprehensive income:
		Currency translation adjustment	69,167	29,766
		Retained earnings	234,287	163,237
Total shareholders’ equity			497,494	387,043
Total liabilities and shareholders’ equity			$1,175,936	$920,557

WIMM-BILL-DANN FOODS

 Consolidated Statements of Cash Flows
(Amounts in thousands of U.S. dollars) 

	2006	2005	2004
Cash flows from operating activities:
Net Income	$95,384	$30,266	$22,974
Adjustments to reconcile net income to net cash provided by operating activities:
Minority interest	3,197	3,649	3,161
Depreciation and amortisation	62,329	53,435	44,003
Currency remeasurement loss(gain) relating to bonds payable and long-term payables	(13,660)	990	(9,938)
Obsolescence and net realizable value expense	601	1,077	3,482
Provision for doubtful accounts	3,130	3,908	3,722
Loss (gain) on disposal of property, plant and equipment	2,340	1,321	1,013
.. Earned income on net investment in direct financing leases	(706)	(402)	(639)
Deferred tax expense(benefit)	(6,671)	3,327	(6,019)
Non-cash rental received	2,938	2,496	1,957
Reversal of tax contingent liability	1,028	(800)	(128)
Loss/(gain) from securities and disposal of long-term investments	86	1,786	190
Write-off of tangible assets and intangible assets	15,633	-	-
Write-off of goodwill	2,539	-	-
Write-off of unrecoverable investments in direct finance lease	131	-	-
Write-off of unrecoverable VAT	588	-	-
Amortisation of bonds issue expenses	1,197	1,046	1,025
Changes in operating assets and liabilities:
Inventories	(18,193)	(25,361)	(9,208)
Trade accounts receivable	(20,023)	(2,636)	(4,883)
Advances paid	(16,224)	9,553	1,356
Taxes receivable	8,187	15,082	13,979
Other current assets	(5,549)	(1,062)	(3,346)
Other long-term assets	45	-	-
Trade accounts payable	21,713	3,649	7,000
Advances received	1,400	1,880	719
Taxes payable	906	6,698	1,526
Accrued liabilities	14,710	2,816	2,913
Other current payables	6,151	678	(3,148)
Other long-term payables	4,045	541	9
Total cash provided by operating activities	$167,252	$113,937	$71,720

WIMM-BILL-DANN FOODS

Consolidated Statements of Cash Flows

 (Continued) 

 - Ends -

For further enquiries contact:
Anton Saraikin
Press Secretary
Solyanka, 13, Moscow, 109028 Russia
Tel +7 (495) 105-5805 (ext. 116-99)
Fax +7 (495) 105-5800
saraikinas@wbd.ru

Marina Kagan Wimm-Bill-Dann Foods OJSC Solyanka, 13, Moscow 109028 Russia Tel +7 495 105 5805 Fax +7 495 105 5800 e-mail: kagan@wbd.ru

Some of the information contained in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Wimm-Bill-Dann Foods OJSC, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995.We wish to caution you that these statements are only predictions and that actual events or results may differ materially.We do not intend to update these statements to conform them to actual results.We refer you to the documents Wimm-Bill-Dann Foods OJSC files from time to time with the U.S. Securities and Exchange Commission, specifically, the Company's most recent Form 20-F.These documents contain and identify important factors, including those contained in the section captioned “Risk Factors” in our Form 20-F, that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, potential fluctuations in quarterly results, and risks associated with our competitive environment, acquisition strategy, ability to develop new products or maintain market share, brand and company image, operating in Russia, volatility of stock price, financial risk management, and future growth.

NOTES TO EDITORS

 Wimm-Bill-Dann Foods OJSC is a leading manufacturer of dairy products and beverages in Russia. The company was founded in 1992.

The Company currently owns 33 manufacturing facilities in Russia and the Commonwealth of Independent States (CIS), as well as trade affiliates in more than 25 cities in Russia and the CIS.

Wimm-Bill-Dann has a diversified branded portfolio with over 1,000 types of dairy products and over 150 types of juice, nectars and still drinks. The company currently employs over 20,000 people.

On May 18, 2006, Standard & Poor’s Governance Services announced the upgrade of WBD’s Corporate Governance Score (CGS) from 7 to 7+ (from 7.3 and 7.7 accordingly on the Russian national scale), which makes the Company’s score the highest rating in Russia. The increase in the score reflects the effective work of the Board of Directors and, in particular, the real influence of independent directors in the decision-making process and the adherence of the controlling shareholders to the highest standards of corporate governance.