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Table of contents 1Consolidated key figures 2Major events 3I. CORPORATE STRATEGY 5II. COMPANY PROFILE 7

Products and markets 7Sales organisations 8Production sites 8Strategic choices and most important achievements 9

III. CORPORATE GOVERNANCE 11IV. REPORT OF THE BOARD OF DIRECTORS 13

Changes in the structure of the Group 13Group structure 14Activities in 2000 17

Uniform brand 17Information integration 18Sales and sales promotion 19New products 19Investments and industrial operation 19Research and development 20Quality management 21Environment 21Personnel and organisation 21Euro 22Evolution of costs 22Profitability 23

Important facts since 31 December 2000 25Prospects for 2001 27Results and proposal for division of profits 29

V. STOCK MARKET INFORMATION 31VI. OTHER COMPANY INFORMATION 33VII. BOARD OF DIRECTORS AND AUDITOR 35

Group management 35VIII. FINANCIAL STATEMENTS 37

Consolidated financial statements 38Comments 49Cash flow statement 52Auditor’s report 53

Financial statements of Lotus Bakeries NV 54Valuation rules 66Comments 67Auditor’s report 68

IX. GENERAL INFORMATION 69

Table of contents

1

32

General• preparations for the implementation of

the integrated information, SAP

• preparations for the switch to the single brand name Lotus

January• operational start of the activities

under the brand name Suzy

February• establishment and start of the joint

venture Harry's Benelux

• takeover of the La Pascalou Group by Interwaffles

March• establishment of a Swiss sales branch

Lotus Bakeries Schweiz

August• realization of the agreement in principle

between NPM and Lotus Bakeries concerning the joint venture Interwaffles and the activities under the brand name Suzy

• start of the construction of the Interwaffles new factory in Courcelles

September • take-over of Kelsen Bakery s.r.o.

(Czechia) by Lotus-Delta

Major events

Consolidated key figures of the Lotus Bakeries Group in millions of EUR

2000 1999 1998 1997 1996

Turnover 131.82 119.48 102.83 88.45 76.33Depreciation (1) 8.06 6.92 6.07 5.68 4.64Operating result 7.01 6.71 5.78 6.07 4.96Financial result (2) (2.83) (2.02) (1.32) (1.46) (0.52)Depreciation on consolidation differences (0.75) (0.75) (0.23) (0.66) (0.48)Result on ordinary activities 4.18 4.69 4.46 4.61 4.44Extraordinary result (0.06) (1.13) 0.24 (0.03) (0.03)Result before taxation 4.12 3.56 4.70 4.58 4.39Taxes (1.64) (1.22) (1.46) (1.33) (1.45)Result of equity method 0.03 0.05 0.02 - -Net result 2.52 2.38 3.26 3.25 2.93- Group's share 2.44 2.32 3.20 3.22 2.88- Minority interests 0.08 0.06 0.05 0.03 0.05Current net result (3) 3.32 4.26 3.25 3.34 3.00Current net cash flow (4) 11.60 12.02 9.25 9.74 9.14Net cash flow 11.89 8.96 8.53 9.79 9.13Investments (5) 18.10 11.60 4.71 5.13 5.85Number of persons employed (6) 1,214 1,012 948 796 678

Consolidated key figures per share in EUR

2000 1999 1998 1997 1996

Current net cash flow 15.45 16.01 12.37 13.04 12.24 Current net result (3) 4.42 5.68 4.36 4.49 4.02 Net result 3.36 3.17 4.36 4.36 3.92 Net dividend- Ordinary share 1.04 1.04 1.04 0.99 0.92 - AFV-share (7) - - - - 0.98 TOTAL NUMBER OF SHARES 750,537 750,537 746,750 746,750 746,750

(1) Not included depreciations on consolidation differences.

(2) Included depreciations on consolidation differences.

(3) Prior to depreciations on consolidation differences and exceptional results.

(4) Current net cash flow is defined as current net result + depreciations + provisions and amounts written off.

(5) Includes 8.72 million EUR in investments in tangible fixed assets for the Lotus Bakeries configuration 1999.

and 9.38 million EUR investments for the joint ventures Interwaffles, Harry's Benelux and Lotus-Delta (in each case part of Lotus Bakeries).

(6) For the joint ventures Interwaffles and Lotus-Delta all members of personnel are taken into account for one hundred per cent.

(7) The AFV-shares have been cancelled at the extra ordinary general meeting of May, 9, 1997 as the tax advantages are expired.

4 5

The biscuit sector consists of a richvariety of product groups in whichmany different technologies are applied,in which there are different consumermoments, in which there are a few trulyinternational products and in which thereare many local preferences in taste.

Lotus Bakeries is trying in this field toachieve a double objective:

• in Belgium, the Netherlands, Luxembourg and France as the brandmanufacturer, to be the market leader for caramelised biscuits, waffles& galettes and for locally important cakes (pastry),

• beyond these four countries the realisation of the important internationalpotential of caramelised biscuits and waffles & galettes.

The product range that is marketed inthe Benelux and France consists ofcaramelised biscuits, waffles & galettesand locally important products likeMadeleine, Frangipane and Zebra inBelgium, Glacé, Battenbergs andJodekoeken in the Netherlands andBreton specialities and Frangipane inFrance.

Outside the Benelux and France theinternationalisation of caramelised bis-cuits and waffles & galettes is realised,whilst a few cake specialities are inclu-ded in the product range in countriessuch as Germany and Great Britain.

In order to expand the brand policy to abroader and more internationally orientedbase, all the brand names currently inuse (Corona, Suzy, Cremers, Le Glazik,Vander, De Bruin, Enkhuizer Banket …)will be brought under the brand nameLotus. The consumer will then recogniseand value a whole range of specialitiesunder a single brand name, and com-munication about the brand nameLotus will be simplified.

The realisation of this strategy will in partbe entrusted to joint ventures so thatthe knowledge, experience or marketpositions of each partner can be utilised.

The recent joint ventures in Interwaffles,Lotus-Delta and Harry's Benelux openup new possibilities in respectively thewaffle market under private label, inCentral and Eastern Europe and in pre-packed bakery products.

The leadership of Lotus Bakeries isbased on:

• the consumer being able to recognise and value the quality of each product

• a production organisation that able to produce at a very competitive cost price

• a commercial organisation and a brand organisation that is in harmony with the objectives of every market

• and a whole range of skills found among the Lotus Bakeries personnel.

The growth that Lotus Bakeries wishesto continue to realise will result from thestrengthening of the market position inthe Benelux and France, from the furtherinternationalisation of its products andfrom acquisitions that can strengthenthese positions.

I. CORPORATE STRATEGY

76

II. COMPANY PROFILE

Products and markets

Lotus Bakeries has decided upon abrand name policy in well-defined product groups: caramelised biscuits,cakes, waffles & galettes. This will berealised by occupying a leading positionin caramelised biscuits, waffles & galet-tes and in local important cakes (pastry)in the Benelux and France, and outsidethese countries, by realising the internati-onalisation of caramelised biscuits andwaffles & galettes.

• Cakes and pastry

This product group consists of manyvarieties with as a common characte-ristic, a high moisture content (up to16%) and short shelf life (eight to tenweeks). The consumption of cakesvaries greatly regionally. This is why it isnecessary to build up a range for eachcountry with several strong productsfrom the country or region as the basis,supplemented with products from theother countries. Through acquisitionsLotus Bakeries has acquired an impor-tant number locally strong products.

In Belgium Lotus Bakeries is the marketleader in the entire cake market with itsprincipal products being Madeleine,Frangipane, Zebra, Midi and Marshmallow.

In the Netherlands Glacés, Battenbergsand Jodekoeken are the main productsin the branch and together with a number of specialities from the othercountries they ensure a leading positionof Lotus Bakeries.

In France Lotus Bakeries has a verystrong position in Brittany with the butterspecialities from Le Glazik. The sameproducts are sold along with someBelgian specialities such as Frangipane,throughout the whole of France.

Outside the Benelux and France, a fewspecialities are sold in particular in GreatBritain and Germany.

• Waffles & galettes

These products, which mostly originatedin Belgium, are enjoying increasing interest beyond Belgium.

Waffles like cakes contain up to 16%moisture and therefore have a limitedshelf life. In particular these are Liège

Waffles, Vanilla waffles, Soft waffles(Brussels waffles), chocolate-coated waffles and filled waffles. Galettes arealso baked in a waffle iron, but they contain little moisture so they can bekept for four to six months. Fine Galettes,Family waffles and Parisettes are theprincipal products.

Lotus Bakeries is the leader in thisimportant product group in part throughthe acquisition of Cremers and Suzy andthrough the joint venture Interwaffles. A brand policy is carried out in all coun-tries with the Lotus brand name that willoverarch the Corona, Cremers and Suzybrands.

Interwaffles manufactures and sells arange of waffles & galettes under theown brand of the distributors.

Lotus Bakeries is, as a consequence,able to bring about a strong internationalexpansion in this rapidly growing branch.

• Caramelised biscuits

Caramelised biscuits are originallyBelgian and owes its typical flavour tothe caramelisation of the sugar duringthe baking process. It can, like most biscuits, be kept for six to nine months.

Lotus Bakeries has, for years, been the undisputed leader in that market inBelgium and has also realised the inter-nationalisation of Lotus Caramelised biscuits.

In Belgium Lotus Caramelised biscuits isa top product within the whole biscuitmarket. But the growth is in particular tobe found in the other countries so thatalready about half of the production issold outside Belgium.

Given that France is still the largest market outside Belgium, then Germany,the United States, the Netherlands,Great Britain, the Far East and othercountries are also really important. In many countries the really big successis the individually wrapped LotusCaramelised biscuit offered with a cup of coffee or tea.

• Other

Enkhuizer Banket, that was taken over in1998, also holds a position in SpongeFingers, that are mostly sold in theNetherlands, Great Britain and Belgium.

98

Sales Organisations

Lotus Bakeries products are consumedboth at home and when people are out.In order to have intense market influence,Lotus Bakeries has specialised salesteams for each market: the retail, cate-ring (large-scale use in schools, clinics,canteens) and food service (hotels,restaurants, cafes and gasstations).

This system is fully developed in Belgium.In the Netherlands, we are presentmainly in retail and the horeca sector. In the French retail and in catering, thereis a strong accent on northern France,the Paris region and Brittany.

For the German and Austrian market,Lotus Bakeries has its own sales organi-sation which is growing rapidly. Thecompany started its own sales organisa-tion for the Swiss market.

In the UK, various import firms havebeen active and are making a considerableturnover with the sale of Lotus Bakeriesproducts.

In Spain, Italy, Israel, Japan, Korea,etc., Lotus Bakeries makes an appeal tospecialised companies that are very active in certain markets.

In addition to sales to airline companiesby a specialised American company,Lotus Bakeries has a joint venture in theUS that is selling Lotus Bakeries pro-ducts as a mail order company (catalogsales).

In the Czech Republic and Slovakiathe joint venture, Lotus-Delta, is operatingin retail and foodservice through specia-lised dealers.

Harry’s Benelux is a joint venture withHarry’s, market leader in France in pre-packed bakery products. In the Beneluxcountries, the company markets a rangeof bread products with a shelf life of 28to 42 days.

Production Sites

Lotus Bakeries’s wide range of productsmeans that very varied product techno-logies are used. Getting to know, maste-ring and further developing these diffe-rent product technologies is a constantchallenge for Lotus Bakeries. In addition,it is necessary to restrict the number ofproducts and technologies per producti-on unit. Therefore, it is necessary todevelop several specialised factories.

In case of take-overs, product redistri-bution has been realised and smaller establishments have been closed down. As a result the volume per product hasrisen, as well as the total production persite.

An overview of the production sites isgiven below:

Belgium

In Kaprijke (Lembeke), in East Flanders,the complete range of Caramelised bis-cuits is produced. The small tarts are alsoproduced there (Frangipane, Snowcake,Strawberry cake, jam tarts).

In Ghent (Oostakker), in East Flanders,Madeleine, Amico, Zebra, Midi andCrembo are produced. This productionsite is also specialised in snack cakes(Marshmallow, Bimbo).

In Meise, in Flemish Brabant, andTurnhout, Antwerp, waffles & galettes,with the exception of filled waffles, areproduced.

France

Comines, Nord Pas de Calais, speciali-ses in filled waffles, coconut productsand Frangipane under the Cremersbrandname and private labels.

In Briec-de-l’Odet, Brittany, Le Glazikproduces the Breton butter specialities:4/4 bars, Mini 4/4, Madeleine, Gâteauxbretons, galettes and palets and panca-kes. The production of Petit Breton hasbeen transferred to Le Glazik.

The Netherlands

Enkhuizen, West Friesland, producesBattenbergs, Jumbos, Swiss Rolls,Jodekoeken and Sponge Fingers,

Amsterdam, De Bruin’s Banketfabriekspecialises in Glacé Originals and GlacéPetits Fondants.

Czech Republic

Lotus-Delta is a joint venture situated in Kladno in the vicinity of Prague. From 1999, production of several cakesbegan: these are destined for the Czechand Slovak markets and may also supplement the Benelux and Frenchmarkets. This is a fallback position if the volume is otherwise too small forproduction in Benelux or France.

In Milin (at the South of Prague) abranch of Kelsen The InternationalBakery has been taken over. This branchis specialized in swiss rolls and somebiscuits. This production is also aimed atthe Central- and East-european market.

Interwaffles

This joint venture produces waffles & galettes under private labels. After the fire at the factory in Buizingen inNovember 1999, production was realised in the factories at Alken and LaPascalou (Couillet, south of Charleroi). Anew factory has been built in Courcelles(North of Charleroi) and is in operationsince the beginning of 2001.

The Alken factory was closed in Januaryand that of La Pascalou will be closingshortly.

The new factory makes use of the newtechnology and increases the capacityand performance of the Group in thearea of waffles & galettes.

Strategic choices and mostimportant achievements

2000 and 2001 are two key years in theachievement of the strategic objectivesof Lotus Bakeries, namely that the leadership will be further expanded in the Benelux and France and the interna-tionalisation will be continued in the othercountries.

In order to do this the following wasachieved in 2000 or will be in the nearfuture:

1. The six companies that have beentaken over in the last four years, havebeen integrated into the Lotus Bakerieswhole and the results of this whole experienced a substantial improvementin 2000. At the same time Lotus Bakeriescaptured brand leadership in the threeproduct groups in which it is active.

2.The three new joint ventures enableLotus Bakeries to strengthen its positionas leader and to develop new markets.

A very modern waffle factory has beenbuilt for Interwaffles so that a range ofwaffles is being produced in a highlyrational manner and at a high level ofquality under private label.

Lotus Bakeries wants to build withLotus-Delta a bridgehead for the production and sale of its range in theCzech Republic, Slovakia and the countries bordering them.

With Harry's Benelux a leading positionhas been taken on the growing marketof pre-packed bakery products inBenelux. The sale and logistics of theseproducts matches very well with LotusBakeries’ shorter shelf life products.

3. Two years ago a start was made withsetting up an integrated informationsystem for all Group establishments. We opted for the SAP system. The firstimportant applications were realised withsuccess at the start of 2001.

4. In order to be a performant brand inthe different markets, the strategic choice has been made to overarch withone brand the variety of brands we currently sell. The realisation of this shallbe done in phases during 2001.

Part of the new factory of Interwaffles at Courcelles

1110

Good organisation and operation of theBoard of Directors and the management,correct information to shareholders and,in general, a competent management ofthe company have been a constant con-cern of Lotus Bakeries’ shareholders andthe Board of Directors. Based on this wewould like to reveal Lotus Bakeries’ current policy.

1. Composition of the Board ofDirectors

The Board of Directors consists perDecember 31, 2000 of nine members:six of them respresent the majorityshareholder Bisinvest NV: Karel Boone,president and managing director,Matthieu Boone, managing director,Stanislas Boone, Johan Boone, PieterBoone and Antoine Stevens. Karel andMatthieu Boone are responsible for day-to-day management. In addition thereare three independent directors: Jean-Luc Dehaene, Chris Dewulf and PaulLippens. The responsibilities of the non-executive directors are mentionedon page 35 in the composition of theBoard of Directors.

The mandates of Karel, Matthieu,Stanislas, Johan en Pieter Boone, ChrisDewulf and Paul Lippens come to anend at the General Meeting in May 2005.The mandate of Antoine Stevens ends inMay 2002 and that of Jean-LucDehaene in May 2003.

The company’s Articles of Associationstate only that directors may be nomina-ted by the General Shareholders’Meeting by simple majority of votes. Theindependent directors are proposed bythe Board of Directors to the GeneralMeeting. In this respect the Board ofDirectors employ a set of criteria whichthey draw up beforehand. The age limitis fixed on seventy years and comes intoeffect on the next General Shareholders’Meeting after the 70th birthday.

2. Function of the Board of Directors.

The normal number of meetings of theBoard of Directors is six per year. Thiswas also the case in 2000.

The Board of Directors has, except what is legally determined, the followingresponsibilities: determining strategy,annual and medium term planning, basicorganisation, supervision of manage-ment, appointment of permanent mem-bers of the executive committee, deci-sions regarding the salaries of the mem-

bers of this executive committee, deter-mination of the results and the valuationrules, long-term financial committments,mergers, acquisitions, strategic allianciesand disinvestments, communication poli-cy, stock options and shares reserved formembers of staff. The Board of Directorsis also responsible for organising goodexternal and internal control of the com-pany.

The statutes specify that decisions ofthe Board of Directors are to be taken bya majority of the votes returned. If thereis a tie in the votes, the chairman of theBoard of Directors does not have acasting vote and the decision is to berejected.

The Board of Directors periodicallyreceives information about sales results.costs and profits, investments and allrelevant matters that enable it to form anassessment of the company’s progress.

In addition, the necessary informationis provided on individual matters sothat decisions can be taken on strategy,organisation, important financial underta-kings, takeovers, and so on. A procedurehas been agreed among the Board ofDirectors which provides for the possibili-ty of calling in independent experts atthe expense of the company. Internalinformation provision for all membersof the Board is also provided for in a procedure, approved by the Board ofDirectors.

The Board of Directors has approvedrules for the exercise of directors func-tions. They include a description of thetasks, the minimum number of meetings,the possibility of organising additionalmeetings, drawing up the “order of theday”, the necessary information to beprovided, the manner of decisionmaking,the rules relating to possible conflicts ofinterest, the report, the reporting of com-mittees and the possibility of acquiringadditional information.

The remuneration and/or other benefitsgranted to the members of the Board ofDirectors are determined by theRemuneration Committee. For the 2000financial year, the fees paid to all direc-tors comes to 112,000 EUR in total.There is only one fixed fee and there areno other benefits in kind or options.

The executive directors, thus only theManaging Directors, receive – in additionto their director’s fee – a remuneration tobe specified by the RemunerationCommittee. This committee bases its

III. CORPORATE GOVERNANCE

1312

decisions on comparative studies rela-ting to job-content. The fees are partlyvariable. The variable part is based onthe company’s progress and results, inaccordance with specific criteria. Theyalso benefit from an option plan, as doall management members of the Group(see further on point 4 under Day-to-DayManagement).

The chairman of the Board of Directorsis also managing director. The presenceof four non-executive directors and threeindependent directors in the Board ofDirectors forms a sufficient counter-weight.

The activities of the Lotus BakeriesGroup belong to the same line of busi-ness and form one whole. The nationalorganisations define how group policy isimplemented in practice. The Board ofDirectors is involved in group policy andany practical actions at group level withthe specific results of the separate natio-nal organisations.

3. Committees set up by the Board ofDirectors

The Board of Directors handles all mat-ters under its competence itself, exceptthose entrusted to the remunerationcommittee. As the number of membersis restricted to nine, and given the medi-um size of the company, other subjectscan be dealt with by the full Board ofDirectors.

The remuneration committee consistsof the three independent directors: theyasses the remuneration policy for allmanagement members and specify thesalary of the most senior managers. Inprinciple, the policy is determined for twoyears. This happened in 1999 and at thebeginning of 2001.

4. Day-to-day management

The executive committee of the Groupis composed of the two managing direc-tors, the managing directors of a nationalorganisation, the director corporatefinance, the secretary-general and the

director(s) who is (are) directly involved inthe subject under discussion.

This executive committee determinespolicy decisions at a group level, is res-ponsible for coordination, lays down jointpolicy and decides on priorities at agroup level. The committee meets as arule every two weeks.

At the discretion of the executive com-mittee, certain subjects will be handledby a specific steering group. Themanagement is sufficiently representedon this steering group.

In Benelux and France, which constitu-te Lotus Bakeries’ home market andwhere Lotus Bakeries is involved inmanufacturing, marketing and sales,there is a national organisation foreach country leaded by a manage-ment committee. It is responsible for allbusiness activities taking place in theseparticular countries.

The remuneration of the management(managing directors, managing directorsin a particular country, directors, mana-gers, in total thirty persons) is determin-ed in accordance with a system appro-ved by the Remuneration Committee.Total remunerations in 2000 came to2,708,000 EUR. Of this, 187,000 EUR isvariable. The variable part is based onspecific criteria, such as the company’sresults, objectives achieved and assess-ment of the department.

From the 28th of October 1999, theregulations on share options gave fullsecurity about the social security statusof the options, after which an optionplan came into operation at LotusBakeries at the end of 1999. The num-ber of options allocated in 2000 came to7,087 in total.

5. Policy concerning appropriation ofprofits

With regard to the allocation of theprofits, the current policy is that approxi-mately 30% of the current net profit willbe paid out in the form of dividends.

6. Relations with the majority share-holders

As stated on page 31, Bisinvest NVhas, according to the transparency-declarations, 60% of the Lotus Bakeriesshares. Bisinvest’s shares are incorpora-ted in the Stichting Administratiekantoorvan Aandelen Bisinvest.

This Institution has a Board of Directorscomposed of twelve members. ThisBoard of Directors deals with subjectsthat are of direct interest to the Institution,such as, for example, exercising pre-emption rights and rules about sharetransfers.

In addition, a group of natural personswho each hold less than 5% of thevoting rights, possesses, according tothe transparency declarations, 9.78% of Lotus Bakeries shares. They deal in consultation with Bisinvest NV. Thisgroup does not have a committee.

In 2000

February

• Establishment of Harry’s Benelux NV

The establishment of Harry’s Benelux NVtook place at the beginning of February2000. Lotus Bakeries and Harry’s eachparticipate for 50%. Harry's Benelux NVmarkets a range of bakery products inthe Benelux, with a shelf life between 28 and 42 days. With this participation,Lotus Bakeries takes a structural step inthe shorter shelf life products segmentthat still has a strong growth potential inthe Benelux.

Harry's Benelux draws up the commerci-al plan, decides about the range of pro-ducts and references, sets publicity bud-gets and such like. It uses the LotusBakeries infrastructure in the field oflogistics, sales, invoicing and administra-tion.

• Takeover of La Pascalou byInterwaffles

Interwaffles took over the shares of LaPascalou at the beginning of February2000. La Pascalou is a manufacturer ofwaffles and galettes, principally underprivate labels. The production is situatedin Couillet (to the south of Charleroi), theturnover in 1999 was 6.69 million EURand at the end of 2000, about 50 peopleare employed there.

The administration and sales of LaPascalou were, soon after the takeover,integrated into Interwaffles. During theyear 2000 and till May-June 2001 theproduction capacity of La Pascalou wasused to continue to supply the clientele.From the beginning of 2001, the produc-tion of La Pascalou shall be integrated inphases into the new Interwaffles factoryin Courcelles.

With this takeover Lotus Bakeries andthe Nationale Portefeuillemaatschappijwanted to take a new step in furtherdeveloping the market of waffles inBelgium and abroad.

March

• Establishment of Lotus BakeriesSchweiz AG

At the beginning of March 2000 a separate sales organisation was startedin Switzerland with the intention of getting more to grip with the Swiss retail and horeca markets.

• Simplification of the legal structurein the Netherlands

In order to simplify the complex legalstructure that arose within the Dutchnational organisation after the takeover ofVicomte at the end of 1998, it was deci-ded to merge the companies comprisingBiscuitfabriek Vicomte BV, SwartVicomte BV, Enkhuizer Banket BV and De Bruin’s Banketfabriek BV withCorona-Lotus International BV and tochange the name of the last named into Corona-Lotus Nederland BV.

Corona-Lotus Nederland BV is then responsible for the production in two factories of glacés, jodekoeken, batten-bergs, jumbos, swiss rolls and spongefingers in two factories, and in addition,carries responsibility for the sales of theLotus Bakeries Group products in theNetherlands.

July

• Merger Interwaffles with Suzy andLa Pascalou

At the end of July 2000 Interwaffles NVmerged with Suzy NV and the compa-nies of the La Pascalou Group. Thenewly created entity then continued tooperate under the name Interwaffles.

August

• Finalisation of agreement in principle Interwaffles/Suzy

At the end of August 2000 the agree-ment in principle that had been taken atthe end of 1999 between Lotus Bakeriesand NPM in relation to Suzy/Interwaffleswas finalised.

This finalisation covered the followingimportant points:

• the sale by Interwaffles to LotusBakeries of the clientele under the brandname Suzy and the brand name Suzy.

For operational reasons the sales andlogistics of waffles and galettes under thebrand name of Suzy were integrated asfrom 1 January 2000 into that of LotusBakeries. The production of waffles andgalettes under the Suzy brand name wasmoved in the course of 2000 to the LotusBakeries factories in Meise and Turnhout.

• the transfer by NPM to Lotus Bakeriesof 50% of Interwaffles NV (as was crea-ted after the merger at the end of July2000).

IV. REPORT OF THE BOARD OF DIRECTORSChanges in the structure of the Group

15

Lotus Bakeries France SA (FR)• Holding France• Sales France (except Brittany)

Biscuiterie Vander SA (FR)• Production filled waffles, frangipane Cremers and private

labels, coconut products

Biscuiterie Le Glazik SA (FR)• Production Breton specialities• Sales Brittany

Petit Breton (FR)• Activities integrated in

Biscuiterie Le Glazik

Jeurgens Banket-, Biscuit- en Chocoladefabriek BV (NL)• Production sponge fingers

Swart Vicomte Ltd (GB)• Sales products Enkhuizer Banket in Great-Britain

Corona-Lotus, Inc. (US)• Sales U.S.A.

Lotus-Delta a.s. (CZ)• Production cakes, biscuits, swiss rolls• Sales Czech Republik and Slovakia

Lotus Bakeries Nederland BV (NL)• Production: - glacé's

- jodekoeken, battenbergs, jumbos, swiss rolls, sponge fingers

• Sales Netherlands

Lotus Bakeries GmbH (DE)• Sales Germany and Austria

Lotus Bakeries Schweiz AG (CH)• Sales Switzerland

Cremers-Ribert NV (BE) • Production of waffles and galettes

Biscuiterie Andi NV (BE)• Activities integrated in the Group

Margarinerie Hinnekens NV (BE)• Production margarines and specialized fats

Harry’s Benelux N.V. (BE)• Sales pre-packed bakery products Benelux

Prilabis N.V. (BE)• Sales specific markets

Lotus Bakeries Réassurances SA (LU)• Reinsurance company

Interwaffles NV (BE)• Production and sales of waffles under private labels

Lotus Bakeries NV (BE)• Parent company of the Group• Production - caramelised biscuits

- cake specialities- cakes

• Sales Belgium• Logistics center Belgium

99,9 %

99,8 %

99,9 %

33,25 %

100 %

50 %

99,9 %

100 %

99 %

50 %

99,9 %

50%

98,7 %

35 % 20 %

50 %

99,5 %

99,9 %

100 %

Group Structure

The structure of the Lotus Bakeries Group at May 7,2001 is as follows:

Assortment prepacked bakery-products of Harry’s Benelux

After the takeover by Lotus Bakeries of this 50% share of Interwaffles thenInterwaffles became a joint venture inwhich NPM and Lotus Bakeries eachhave a 50% participation. Interwafflesproduces and sells waffles under privatelabel. Production started as from thebeginning of 2001 in the newly construc-ted factory in Courcelles.

September

• Takeover of Kelsen Bakery (Czech Republic) by Lotus-Delta

At the start of September 2000, the jointventure Lotus-Delta took over the KelsenBakery s.r.o company, the Czech branchof Kelsen The International Bakery A/S.Kelsen Bakery produces biscuits andswiss rolls in Milin (Czech Republic) andrealized a turnover of 1.24 million EUR in1999.

Through this takeover Lotus-Delta cur-rently has a product range with which agreater turnover can be realized in theCzech Republic and the surroundingcountries.

December

• Merger Cremers with BiscuiterieRibert

The beginning of December 2000 saw the merger of Cremers NV andBiscuiterie Ribert NV to form the newentity Cremers-Ribert NV. The mergerwas prompted by the necessity to inte-grate the waffle activities of both compa-nies (including the activities under theSuzy brand), to simplify the structure ofthe Lotus Bakeries Group in Belgiumand to reduce costs.Cremers-Ribert NV currently produceswaffles and galettes under the futureumbrella brand name Lotus at two sites,namely Meise and Turnhout.

• Merger Lotus-Delta with Kelsen Bakery

At the end of December 2000 KelsenBakery s.r.o. was merged with Lotus-Delta a.s. for integration- and administrativereasons.

In 2001

April-May

• Modification of the company nameto Lotus Bakeries

At the beginning of April 2001 the company name of Corona-Lotus NVwas changed to Lotus Bakeries NV.

During April-May the names of the subsidiaries in France, the Netherlands,Germany, Switzerland and Luxembourgwill be changed to respectively LotusBakeries France SA, Lotus BakeriesNederland BV, Lotus Bakeries GmbH,Lotus Bakeries Schweiz AG and LotusBakeries Réassurances SA.

17

Uniform brand

As a specialist, Lotus Bakeries has conti-nually concentrated on the market andhas built up a significant position in threeproduct groups: caramelised biscuits,cakes and waffles & galettes. Thanks toa dynamic policy, Lotus Bakeries hasalso become the owner of a large num-ber of brands and/or products withstrong market positions, such asCremers, Suzy, De Bruin Glacés, LeGlazik butter specialities, EnkhuizerBanket, Vander and so on (in addition tothe Lotus and Corona products, of course).

• The future choice of Lotus Bakeries

In order to create a broader and moreinternationally oriented base for ourbrand policy, from now on all of the pre-sent brands (Corona, Suzy, Cremers, LeGlazik, Vander, De Bruin, EnkhuizerBanket etc.) will be housed under onesingle brand: Lotus. In this way, the con-sumer will be able to identify and appre-ciate a whole range of specialities underone single brand name.

In addition, communication regarding theLotus brand will be simplified. The choiceof the new Lotus logo is the result ofcareful research. The new image is dyna-mic, and it lends itself to perfect integra-tion into all the designs for the variousproduct groups.

• Switching from the existing packa-ging to the new packaging

The basic principle for switching from theexisting packaging to the new packagingis the avoidance of breaks in recognition.The consumer must, after all, continue torecognise the product and the brandname.

The new packaging was therefore desig-ned so the product identity is retained,the specific product quality of eachLotus product is better expressed andthat a feeling is created that the variousproducts belong to one strong range ofproducts.

To ensure a smooth transition to the newbrand, market-specific information cam-paigns will be developed. They shallcommunicate the changes to the productpackaging and the new content of theLotus brand.

• Lotus: a strong brand with a uniquepositioning

In order to bring all of the differentbrands and strong products in the LotusBakeries stable to the market under thenew, single brand Lotus, it is essential tounambiguously define the positioning.

As the result of thoroughgoing researchin the various markets and for the vari-ous product groups that make up theLotus product range, it is evident that:

• Lotus products are unique, high-qualityand tasty products

• which moreover make an occasion just a bit richer, more complete or more cosy, no matter when or where.

This is why there has been chosen thefollowing Lotus baseline, which is anexpression of the Lotus Brand Essence:“Lotus, Deliciously cosy”.

The Lotus Bakeries’ communication willconvey this brand essence.

• The Lotus brand name backed upby a new company name: LotusBakeries

In order to emphasise to the customersand consumers our dedication to theLotus brand, Lotus Bakeries has deci-ded to bring the company's name in linewith the uniform Lotus brand. A new andunambiguous company name LotusBakeries NV and a new corporate logohave been chosen. The formal decisionto make this change has been taken bythe general shareholders' meeting onApril 10, 2001.

• Concrete realization

Since January 2001 the packaging ofLotus Caramelised biscuits have beenmarketed with the new logo. In May thensome of the important cake products will follow, namely Madeleine andFrangipane. Thus in the course of 2001almost all switchovers will be realized inpractically all markets.

This strategic choice was taken inAugust 1999. Corporate Marketing iscoordinating the preparations and reali-zation. In addition various departmentshave collaborated intensively in the fur-ther elaboration of this far-reaching project.

Activities in 2000

1932

1961

1989

2001

1. Previous and new packaging of Frangipane2. Staff members Corporate Marketing

1.

2.

1918

Information integration

Lotus Bakeries has, like every organisa-tion, a need to streamline its processesand to make data more uniform sothat administrative back-up of all activi-ties and unambiguous reporting of costs,incomes and results can be more effective.This task was made more arduousthrough the increasing number of pro-duction sites and sales organisationsand through the fact that the companiestaken over each had their own admi-nistrative system, supported by its owncomputer system.

On the basis of a preliminary study thedecision to adopt an ERP package(Enterprise Resource Planning) wasmade at the end of 1998, a system suchas used or planned for use in manycompanies. The Director CorporateFinance leads this sizeable project with a team of employees who were mostlyfreed from other duties for this work. In each activity domain the method ofworking is studied and adapted to theERP approach. This is possible throughintensive collaboration between themanager(s) and the personnel of everydomain and the ERP-team. External specialists who, on the onehand, provide the concept and on theother hand ensure the implementationtogether with the internal team, are advising on the entire project.

The entire investment is spread overthree years, 1999, 2000 and 2001, andin addition to the licences for the SAPpackages also consists of the purchaseof new hardware, the costs of the exter-nal consultancy and the cost of the ERP-team freed from other duties.

At the beginning of 2001 an importantpart of the planned activities was alsoeffectively switched over to the SAPsystem. This concerned sales, logisticsand finance. This transfer was comple-ted successfully thanks to the very goodcooperation of the managers and allemployees in these activity fields and the ERP team. It is apparent that theemployees involved are, themselves,very aware of the future importance forLotus Bakeries of a properly integratedsystem and they all took great efforts toensure that the system will work. Thereis therefore great confidence that thesecond stage, namely production andproductcosting and sales supplies.which will start within a few months, willalso be completed just as successfully.

Sales and sales promotion

The consolidated turnover of LotusBakeries rose in 2000 by 10.3% to131.8 million EUR. The internal growth,thus without the Suzy brand and withoutthe net impact of the new joint ventures,accounted for more than half of this rise.In the last four years the consolidatedturnover rose by 73%.

For the various geographical markets theturnover developed as follows:

The turnover in Belgium in 2000 amoun-ted to 54.2 million EUR. Compared to1999 this was an increase of 10.7%.Alongside the integration of the salesunder the Suzy brand (which are mostlyrealized in the Belgian market) an impor-tant internal growth was achieved.

This is 84% more than 1996.

In the USA sales rose by 19.4% to 5.4million EUR. This is a very positive deve-lopment. It should however be pointedout that last year certain costs that werepassed on had not been included in theturnover so that a lower turnover wasrecorded in the consolidated figures for1999.

Sales in the remaining markets rose byalmost a half. Especially those of SouthEast Asia developed very favourably.

New products

Given that Lotus Bakeries has, in the lastfew years, taken over quite a number ofcompanies, the range of products hasbeen greatly expanded and strengthenedwith Cremers galettes, jam tartlets, jode-koeken, jumbos, swiss rolls, sponge fin-gers, demi-lune quatre-quarts, panca-kes, and various sorts of waffles.

This has resulted in a change of empha-sis in our policy concerning the develop-ment of new products. Lotus Bakeriesdoes want to develop new products butshould now be giving more attention pro-portionally to the products from the com-panies it has taken over.

During 2000 a completely new jam tartletwas developed in the range of shorterself-life products. It will be launched atthe beginning of May 2001. This productconsists of a light, crispy flaky pastrycase filled with apricot jam.

Investments and industrial ope-ration

The investments made by the LotusBakeries Group reached a historic record

1996

1997

1998

1999

2000131,82

119,48

102,83

88,45

76,33

50 60 70 80 90 100 110 120 130 140

EVOLUTION OF SALES in millions of EUR

Staff members ERP team and informatics

The increase since 1996 amounts to 51.4%.

In the course of 2000 Harry’s Beneluxlaunched the name Harry’s as a newbrand in Belgium for prepacked bakeryproducts. The product range has beentaken up in practically all important distri-bution chains in Belgium. The introductionand support of the brand name Harry’s inBelgium will demand significant commer-cial investments for a number of years.

In the Netherlands the rise in the turn-over was 3.8% taking it to 24.8 million EUR.A significant portion of this increase wasdue to the favourable evolution of thesales of Glacé. The rise since 1996amounts to 143%.

In France too the turnover developmentwas positive: 23.4 million EUR or + 3.6%compared to 1999. At the beginning of

2000 the organisation ofPetit Breton has been inte-grated into that of Le Glazik.The turnover level attainedmakes further specialisationof the sales organisationpossible. The rise since 1996amounts to 35.8%.

As in previous years the turnover in Germany sho-wed a very sharp increaseand amounted to 6.8 millionEUR. This is a quadruplingsince 1996. The sales orga-nisation could therefore bestrengthened.

In Great Britain LotusBakeries sells through a net-work of various specialisedsales organisations. Turnoveronce again showed a consi-derable rise and amounted to 12.3 million EUR.

GEOGRAPHICAL SALES DISTRIBUTION

Publicity for Harry’s products

2120

• the construction of a new production line for Liège waffles at Turnhout and the upgrading of the Liège waffle line at Meise

• the ERP project: mainly the implemen-tation of the SAP system

• installation of a new production line forpancakes and silos in Le Glazik (Briec-de-l’Odet).

In addition once again a large number of investment projects were realised that are aimed at increased modernisationand automation of the production orwhich improve quality, hygiene and safety within the production sites.

The integration of the companies recentlytaken over also resulted in 2000 in a re-arrangement of production lines:

• as a result of the take-over of the production and sales of waffles under the brand name Suzy at the beginningof 2000 the production of Liège waf -fles was reorganised and divided across the production lines of Meise and Turnhout

• closure of the remaining production units of Petit Breton and transfer of these to Le Glazik.

2.The new joint ventures of 2000

Following the burning down of theInterwaffles factory in Buizingen in

amount in 2000: 18.1 million EUR compared to 11.3 million EUR in 1999.These investments can be split up as follows:• for the Lotus Bakeries configuration

1999 the investments in material fixed assets amounted to 8.72 million EUR

• for the joint ventures Interwaffles, Harry’s Benelux and Lotus-Delta investments amounted to 9.38 million EUR (only part Lotus Bakeries).

1. Lotus Bakeries configuration 1999

For the Lotus Bakeries configuration1999 the most important investmentsrelated to:

• the construction of a new manu-facturing line for individually packaged caramelised biscuits at Lembeke

November 1999, Interwaffles built a newmodern factory in Courcelles, (nearCharleroi) for the production of wafflesunder distribution labels. The total invest-ment (purchase of land, construction ofnew factory and installation of new andexisting production lines) amounted to20 million EUR, of which half was at theexpense of Lotus Bakeries.After the fire, production had to be conti-nued in Alken (a factory that was alreadybeing closed down) and in Couillet (LaPascalou that had been taken over inFebruary 2000). These two factories didnot turn out a good performance andresulted in heavy losses.

At the end of December 2000 the buil-ding in Courcelles was taken into use bythe various services and the administrati-ve branch at Buizingen was closed. Thestart-up of the first three lines occurredat the beginning of 2001. In the sameperiod the factory at Alken was also shutdown. The closure of La Pascalou isexpected in the near future.

After the initial start-up period Interwaffleswill be able to produce a range of wafflesunder distribution labels in a very rationalmanner and at a qualitatively high level.

Lotus-Delta in Czechia invested in asecond production line for the producti-on of mini-frangipanes. It was taken intooperation in April-May 2000. In Lotus-Delta products are produced for the localmarket and a few products for the basicmarkets of Lotus Bakeries of which thequantities are too small to be producedcompetitively in the factories in Belgium,the Netherlands or France.

Research and Development

In two areas, Lotus Bakeries is trying toplay a prominent role in its sector, bycoordinating its expertise and targetingits projects: in investigating productimprovements/new products andtechnical applications.

In both domains, the emphasis is alwaysplaced on the own responsibility of thefactory itself to manage and improvetechnology and the techniques. Besideit, Lotus Bakeries has an investigatingdepartment and a central technicaldepartment that bring together theknowledge and experience present inthe various factories and add their ownknowledge and experience. This willmake it possible to undertake large pro-jects or projects requiring specialisingknow-how.INVESTMENTS in millions of EUR

1996

1997

1998

1999

200018.1

11.3

4.71

5.13

5.85

0 5 10 15

Environment

Lotus Bakeries’ activities affect the environment in mainly two domains,these being packaging and the exploita-tion of the factories. In both domainsLotus Bakeries is continuing to work ondecreasing its environmental impact.

Environment and packaging

Lotus Bakeries continues to seek oppor-tunities for limiting the amount of packa-ging and for materials that in addition tomeeting safety, reliability and consumerrequirements are also environmentallyfriendly. The responsibility for this lieswith the person responsible for marke-ting so that every endeavour will betaken to achieve these goals when developing or adapting products.

Lotus Bakeries has always been infavour of creating workable systemsthrough collaboration between the diffe-rent actors so that the management ofthe packaging waste is part of goodenvironmental management. LotusBakeries continues to actively work onachieving this. In Germany, Belgium andFrance the company is required to takeback the packaging waste. This is achie-ved through collaboration with manufac-turers of disposables, and the distribu-tion and packaging industries: Duales-System in Germany, Fost Plus inBelgium and Eco-Emballages in France.

The Dutch companies participate in theCovenant Packaging II, whereby throughprevention, attempts are made to achie-ve certain objectives relating to reuse,recycling and energy generation. Theobligation as a company to contribute tominimising the environmental overloadcaused by packaging waste within theDutch marker fits into our policy.

Environment and exploitation

In this domain various environmentalaspects come to light. These are syste-matically investigated and appropriatemeasures taken so that negative effectsare removed or can be reduced. Thewaste products are attacked accordingto sort. In most sites a water purificationstation is already in operation or aninvestigation is being carried out into thebest solutions so that consideration willalso be taken with the government rulesapplying to that country. For the otherwaste products maximum recovery isthe solution sought (eg paper, carton) or incineration in specialised centres

(eg packaging foils).

Any possible nuisance for the local resi-dents is systematically investigated andany possible solutions are applied. Thechanges requested in the zoning plan inLembeke could contribute to a reductionin the nuisance when this site is expan-ded further. As the logistics center inLokeren is now operational, the trafficnuisance in Lembeke and Oostakker hasbeen considerable reduced.

Personnel and organisation

Personnel development

At the end of 2000 the Lotus BakeriesGroup employed 1,214 members ofstaff. This is an increase of 202 employ-ees compared to the end of 1999. Thissharp increase is the result of the inclu-sion in the figures of the joint ventureInterwaffles, Kelsen Bakery and theexpansion of the labour force atCremers-Ribert. The members of staff ofInterwaffles in the factories at Buizingenand La Pascalou were naturally offeredwork in the new factory at Courcelles orin the factory at Meise. A large numberof personnel accepted this offer.

In contrast to all other figures relating tothe joint ventures Interwaffles and Lotus-Delta whereby the Lotus Bakeries por-tion, this being half, is considered ineach case, the personnel figures forthese joint ventures take into account allmembers of personnel for one hundredper cent.

The number of members of staff thatwork part-time remained approximatelystable, numbering some 277 employeesat the end of 2000. This stabilisation canbe explained by the fact that Interwafflesand Kelsen Bakery do not employ per-sonnel part-time.

Quality management

As a producer of branded products it isessential that the quality of the productsis a cut above that of the market averageand that the quality level is constantlyachieved.

Lotus Bakeries has, to that end, set up asystem of quality management that isapplied in all production centres. Foreach topic clear guidelines have beenlaid down:

• selection criteria for suppliers:the suppliers will be approved on the basis of structured suppliers’ audits and on the basis of the assessment ofthe performance delivered in the year.

• specifications and control systems for raw materials and packaging:in addition to the established specifi-cation for all raw materials and packa-ging detailed specifications were drawnup for product safety. The incoming raw materials are inspected on that basis. In all production sites a system is in place through which for each lot of finished products the used lots of raw materials can be identified (tracea-bility).

• process description of the production:all production processes have a com-plete description for the benefit of the production so that a constant quality can be obtained.

• quality of the finished products: in the production a systematic quality assessment has been introduced. In addition there is a central quality assessment with a quality figure.

• quality and relationship with the clients: the complaints are dealt with systematically and followed up further if necessary. In addition there are procedures for dealing with serious complaints or a crisis.

• hygiene scheme: for all production processes there are HACCP plans perproduction line. Systematic audits will then be carried out on the basis of hygiene checklists.

In addition to the internal audit of allthese aspects, external certification isalready in place or is planned for theimmediate future. Depending on thestage this relates to HACCP certification,BRC or ISO 9002.

New product: Jam tartlet

1996

1997

1998

1999

2000 1214937

Full-time

277

1012738

Part-time

274

948691257

796637159

678514164

600400200 800 1000 1200 1300

PERSONNEL

2322

Financial ratios in % of operating income

2000 1999 1998 1997 1996

Added value 38.21 39.24 38.60 41.52 42.46 Current net cash flow 8.43 9.76 8.90 10.85 11.68Current net profit 2.42 3.46 3.13 3.73 3.85

Financial ratios in % of added value

Personnel expenses 68.64 67.86 68.51 63.96 63.78Depreciations 15.34 14.33 15.11 15.22 13.93Taxes 3.13 2.50 3.37 3.58 4.36Net financial charges 3.96 2.63 2.71 3.74 1.46Current net profit 6.32 8.83 8.10 8.98 9.06

Training

The capacity of Lotus Bakeries to attainits strategic objectives will to an impor-tant extent depend on the knowledgeand skills of each member of staff andon the proper operation of the organisa-tion.

Through training Lotus Bakeriesattempts to achieve the following objectives:

• the skills and knowledge of each member of staff will be further expan-ded so that the current function can be taken fluently and that changes in this function can be absorbed easily

• the general skills that are associated with the proper operation in an organi-sation and those that are linked to motivation and management will be systematically perfected.

Every department plans a number of trai-ning courses that are specifically suitedto the educational level of the membersof personnel concerned and to the chal-lenges of the future. In addition generaltraining courses are given that are provi-ded for the management of the entireGroup.

Each year the volume of training effortsrises each year. In 2000 in the LotusBakeries configuration 1999, in total2.14% of the salary costs were spent ontraining.

Euro

Lotus Bakeries has been preparing tho-roughly and pro-actively for the changeto the European single currency. Given

the diversity of situations within theGroup it was decided that a gradual pro-cess of change was best.

Several concrete applications in the vari-ous services:• clients who want to, could be invoiced

and could pay in euro as from January 1,1999

• As from January 1, 1999 a policy of encouragement has been adopted so that the suppliers should invoice in euro

• the accounts and the internal reportingof the companies in the Group are changed over to the euro on January 1,2001.

• the employees and the employees’ councils in the Lotus Bakeries Group sites were informed as from 5 October1998 and an update on the situation was distributed through various chan-nels (internal communication system and in-house staff journal)

• since 1 January 1999 the pay slips for employees in Belgium have stated the net amount of the wages in euro as well

• the Lotus Bakeries shares have been listed on Euronext in euro since January 1, 1999

• the 1998 annual report was still drawn up in Belgian franks. Key figures, con-solidated balance and income state-ment were also given in euro for the first time

• the annual reports for 1999 and 2000 are expressed completely in euro.

The most important action still to beundertaken concerns the calculation ofthe wages of the employees. A set ofinformation shall be given to the person-nel in collaboration with the employees’councils. The entire calculation of thewages shall, there were it is possible, be

The exceptional result improved appre-ciably. This was mostly to do with thefact that in 1999 all costs and recupera-ted reimbursements from the dioxin crisiswere booked as exceptional costs andrevenues. In 2000 no such exceptionalcosts were incurred but an additional

compensation payment was received viathe insurance. Furthermore there was acompensation payment made by thefederal government as reimbursement ofcertain costs as a result of the dioxin crisis.

Profitability

In 2000 the growth policy of LotusBakeries was continued through take-overs and the integration of the acquiredcompanies into the complete organisa-tion of Lotus Bakeries.

Given that with a takeover there is usual-ly some loss in turnover through rationali-sation of the product assortment, andbecause of the integration costs thefavourable effects of a takeover generallyonly show in the results a year or twolater.

• Lotus Bakeries Group

The operating result rose by 4.5% andreached a figure of 5.32% with respectto the turnover. The results before taxesrose by 15.7%. The current net result fellby 22.1% to a figure of 3.32 million EUR.Considerably improved exceptionalresults saw the net result rise by 5.9% to2.51 million EUR. The current net cashflow fell by 3.5%.

• Lotus Bakeries configuration 1999

The operating result of the LotusBakeries configuration 1999 saw a riseof 12.7% and the results before taxeseven rose by 53%. This considerable

done in euro as well as in the local cur-rency during some months, to familiarizethe personnel with the calculations ofwages in euro.

Evolution of the costs

The prices for the raw materials remai-ned approximately the same as in 1999.In the course of 2000 however the costsof energy rose much more sharply thanhad been anticipated. The packagingmaterials also showed considerableincreases in price.

The services and various goods postrevealed a considerable rise. This was inpart due to pushing the Suzy brand.

There were also increases in costs, inparticular personnel costs, arising fromthe strengthening of the sales organisa-tions in France, Germany andSwitzerland, and through the further inte-gration of the companies taken over andthe integration of the waffle production ofSuzy. Yet the rise in personnel costsremained restricted through rationalisa-tions and increases in productivity.

The depreciation on fixed assets rosefrom 6.92 million EUR to 8.06 millionEUR in 2000. This increase is related tothe depreciation in the companies takenover and the increase in investments.

The financial costs rose considerably.This arose from the increase in the finan-cial debts as a result of the financing ofthe companies acquired and an increasein basic interest. The depreciations inconsolidation differences remained prac-tically unchanged.

improvement in the results was achieveddespite certain parts doing less well.Cremers-Ribert and the Netherlands didnot achieve the expected results and LeGlazik was still suffering from the integra-tion of the acquisition, Petit Breton.

• The three new joint ventures in 2000

Given that Interwaffles, following the firein Buizingen, had to continue productionin two poorly performing factories heavylosses were incurred. Lotus-Delta toosuffered losses as a result of invest-ments. The important commercial invest-

1996

1997

1998

1999

2000 52.54

48.31

40.13

37.26

33.22

30 40 50

EVOLUTION OF ADDED VALUEin millions of EUR

ments also led to losses at Harry’sBenelux. The three new joint ventureshad overall a negative impact of 1.33million EUR on the consolidated resultsbefore taxes of the Lotus BakeriesGroup in 2000.

11.60

Current net profit

Depreciation + amounts written off + provisionsfor liabilities and charges

EVOLUTION OF CURRENT NET CASH FLOW in millions of EUR

1996

1997

1998

1999

2000 3.328.28

12.024.267.76

9.253.256.00

9.743.346.40

9.143.006.14

864 10 12

Robot new factory Interwaffles

25

Important facts since 31 December 2000

On 21 March 2001 Lotus Bakeriesannounced its strategic decision to use asingle brand name Lotus. On page 17more explanation is provided about thesingle brand name.

As a consequence of the decision to usea single brand name Lotus the companyname Corona-Lotus was changed toLotus Bakeries during the extraordinaryshareholders’ meeting on 10 April 2001.As from this date the company will alsobe using the new corporate logo.

1. New production line individually wrapped caramelised biscuits at Lembeke.

1.

27

Prospects for 2001

The consolidated turnover in 2001should show a rise of about 5%. Themost important products should see further growth through their growing significance in more and more markets.In addition the rationalisation of productsis being continued: the acquisition of aconsiderable number of companies hasmade it necessary to restructure theexisting products and references to forma range of better performing products.This will result in a loss of turnover.

As Interwaffles has been semi-includedin the consolidation in 2000 as from 1 July, then its semi-inclusion in 2001 for the whole year will also influence thegroup turnover.

The investments in fixed assets willamount to about 11 million EUR.The most important of these are:

• Production installation for jam tartlets inthe Lembeke factory

• new production line for vanilla waffles inthe factory in Turnhout

• rearrangement and automation of a production line in the factory at Enkhuizen

• investments in all factories in packagingmachines, production systems and automation

• further implementation of the SAP system

The prices of raw materials and packa-ging show a slight increase. After a periodof relatively low raw material prices thereis an adjustment for the most importantraw materials. The packaging materialsshow, following those of 2000, an increa-se in prices, in part as a result of the highenergy prices and the dollar exchange rate.

Energy prices remain high.

Investments in the market, marketingand promotional costs show a sharpincrease in 2001. The introduction ofLotus as the coordinating brand nameand the communication plans that arelinked to this also play an important rolein this.

The personnel costs will rise relativelyless steeply than the turnover because offurther improvements in the operation invarious fields.

The depreciations will show a conside-rable rise due to the important invest-ment made in 2000, especially inInterwaffles and Lotus-Delta, and in theinvestments in the ERP project and inthe coordinating Lotus brand name.

The results of the Lotus Bakeries confi-guration 1999 will show, as in 2000, asignificant rise. Through this LotusBakeries is successful in restructuringthe acquired companies so that, follo-wing their integration in the productionand sales policy, they will make a goodcontribution to the group results.

Like 2000, the results of the threerecent joint ventures will also have anegative impact on the results in 2001:

• In the new Interwaffles factory (an investment of 20 million EUR, of which half was made by Lotus Bakeries) the first three production lines are in the start-up phase. The results of 2001 will be strongly influenced by significant start-up costs, so that a negative impact on the results of Lotus Bakeriescan be expected, comparable to that in 2000. After the start-up period Interwaffles will have a high performance.automated production that will also be profitable.

• Lotus-Delta currently has a product range with which a more substantial turnover can be realized in the Czech Republic and the surrounding countries.In 2001 it will be necessary to invest in a performant commercial organisation.

• Harry's Benelux will in 2001 make further investments in the market and subsequently suffer a similar loss to that in 2000. The turnover will then reach a high level and produce a nor-mal profit margin in the following years.

The new joint ventures still demand con-siderable investments, but they do openthe door to new markets with positivefuture perspectives.

The net results should show an increaseof about 15% compared to 2000.

1. Individually wrapped caramelised biscuits

1.

The results of the year 2000 of the parentcompany Lotus Bakeries NV are as follows: in EUR

• Profit of the financial year 1,930,044.15• Transfer from untaxed reserves 22,426.38• Transfer to untaxed reserves (19,138.74)Profit for the year available for appropriation 1,933,331.79

The Board of Directors propose to appropriate the profit balance as follows:

• Transfer from reserves available for distribution(1) (839,558.55)• Transfer to reserves available for distribution 792,276.11• Transfer to reserves not available for distribution(1) 839,558.55• Distribution of a gross dividend of 1.3882 EUR

to 750,537 shares(2) 1,041,898.27The dividend is unchanged as compared to 1999

• Distribution of emoluments to directors 99,157.41TOTAL 1,933,331.79

2928

Results and proposal for division of profits

Consolidated

The consolidated current net profit of the year 2000 amounts to 3.32 millionEUR as compared to 4.26 million EURlast year. Depreciations on consolidation differences amounted to 0.75 million EUR.

Taking into account exceptional resultsand depreciations on consolidation differences, the consolidated net profitamounted to 2.52 million EUR. The Group’s share in this figure amounts to 2.44 million EUR.

Statutory

(1) Corresponds to the amount of purchased shares in 2000

(2) The dividends on the purchased shares will be paid to Lotus Bakeries NV and, as a conse-quence, will not be suspended.

In line with legal requirements, the balancepresented for the approval of the share-holders has been drawn up based onthis distribution.

If the Ordinary General Meeting of shareholders of 11 May 2001 acceptsthe Board of Directors’ proposal, the netdividend per share will amount to 1.04 EUR, after deducting a withholdingtax of 25%. This net dividend will bepayable as from May 21, 2001 on surrender of coupon n°13 at the BankDegroof, Fortis, BBL, KBC, Artesia andSociété Générale.

1996

1997

1998

1999

2000 1.04

1.04

1.04

0.99

0.92

0.5 1 1.5

EVOLUTION NET DIVIDEND in EUR

3130

Stock data about the Lotus Bakeries share in EUR

2000 1999 1998 1997 1996

Highest price 71.00 71.70 93.46 74.12 64.45 Lowest price 54.00 58.70 66.93 57.02 52.06Price per 31/12 56.00 68.00 71.64 66.93 57.02Market capitalisation per 31/12 in millions of EUR 42.03 51.04 53.50 49.98 42.56Number of shares per 31/12 750,537 750,537 746,750 746,750 746,750Ratio price/earning (PER) (1) 12.67 11.97 16.43 14.90 14.18Ratio price/cash flow (PCF) (2) 3.62 4.25 5.79 5.13 4.66

(1) PER: PER: Price Earnings Ratio: The price at the end of the year divided by current net result, share of the Group per share.(2) PCF: PER: Price Cashflow Ratio: The price at the end of the year divided by current net result, share of the Group + depreciations,

amounts written off and provisions, per share.

V. STOCK MARKET INFORMATION

Structure of shareholdings

Based on the transparency noticesreceived by Lotus Bakeries, the share-holding in Lotus Bakeries NV as of 15April 2001 is as follows:

Bisinvest NV 60.00%Group of natural persons acting in concert with Bisinvest NV 9.78%Axa Royale Belge 4.79%Own shares (1) 1.69%Public 23.74%

100.00%

(1) The voting rights associated with the shares heldby Lotus Bakeries NV have been suspended. Thedividends have not been suspended and will be paidout to Lotus Bakeries NV.

Market capitalisation

The Lotus Bakeries shares are tradingon the spot market with double fixing onEuronext. On 31 December 2000, themarket capitalisation amounted to 42.03million EUR.

Evolution of the price of theLotus Bakeries share

The opposite graphic reflects the price-evolution of the Lotus Bakeries share incomparison with the BASR (Brussels AllShare Return)-index. The BASR-indexreflects the price of the total Belgianmarket (shares of the Forward and SpotMarket).

Stockdata about the LotusBakeries share

The charts with the consolidated keyfigures per share, respectively the stock-data of the Lotus Bakeries share, arementioned on pages 2 and 30 of thisannual report.

Financial calender

Friday May 11, 2001

General Ordinary Meeting of sharehol-ders at the registered office at 16.30h

Monday May 21, 2001

Payment of dividend

Thursday September 20, 2001

Announcement of the half year report2001

Thursday March 14, 2002

Announcement of the year results 2001

Friday May 10, 2002

General Ordinary Meeting of shareholders.

Proposals to the GeneralOrdinary Meeting of May 11, 2001

1. Proposal to approve the financial statements of Lotus Bakeries NV datedDecember 31, 2000.

2. Proposal to approve the proposeddistribution of profits.

3. Proposal to discharge by separatevote the directors and the auditor fromtheir mandate.

4. Proposal for the reappointment ofErnst & Young Reviseurs d’EntreprisesS.C.C. (B160), represented by Mr. ErikDe Lembre and Mrs. Rosita Van Maeleas Auditor of Lotus Bakeries NV for aperiod of three years and acceptance of the proposed remuneration. The man-date will lapse immediately after theOrdinary General Shareholders’ Meeting in 2004.

1989 1990

50

100

150

200

250

300

350

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Lotus BakeriesBASR-Index

3332

VI. OTHER COMPANY INFORMATION

Changes to the Capital

In the financial year 2000 no changeshave taken place in the company capital.

Purchase of Own Shares

The Extraordinary General Meeting of 16December 1999 granted the Board ofDirectors of Lotus Bakeries the powers,for a period of 18 months, to purchase7,500 Lotus Bakeries shares on thestock market for a unit price of between5 and 90 EUR.

The Extraordinary General Meeting of 12 May 2000 granted the Board ofDirectors of Lotus Bakeries new powers,for a period of 18 months, to purchase7,500 Lotus Bakeries shares on thestock market for a unit price of between50 and 90 EUR.

The intention of the purchases is to beable to deliver shares at the momentwhen the option holder exercises hisoptions. This is part of the Share OptionPlan whose principles were approved bythe Board of Directors on 21 May 1999and 2 July 1999.

During the course of 2000, LotusBakeries bought 12,553 Lotus Bakeriesshares with a total value of 839,558.38EUR, i.e. for an average price of 66.88EUR. This is 1.67% of the total numberof shares.

In the period between 1 January 2001and 20 April 2001, no more shares ofLotus Bakeries were purchased.

All transactions on the stock marketwere carried out in accordance with theauthorities conferred to the Board ofDirectors by the Extraordinary GeneralMeetings of shareholders on 16December 1999 and 12 May 2000.

Conflict of Interests

(Article 523 of the Companies Code)

In 2000 no situations involving a conflictof interests have occured that fell withinthe application of Article 523 of theCompanies Code.

Services Provided by theCompany Auditor

In line with article 134 of the CompaniesCode, we are obliged to mention thatour Auditor and the companies withwhom it co-operates, carried out assign-ments for us during the last year for atotal sum of 100,056 EUR.

Group management Situation April 16, 2001

Group management Karel Boone President Executive CommitteeMatthieu Boone Vice-President Executive Committee

Corporate departmentsPurchase Karel Tack DirectorCentral Technical Services Dirk Verstraeten DirectorCorporate Marketing and International Sales Dirk Jacxsens Director

Frank Cohnen Sales Manager GermanyBart Bauwens Export Manager

Finance Wilfried Deleye Director Corporate FinanceJoseph Bultynck Finance, Consolidation and Risk

ManagerLuc De Backer IT and Logistic Information

Systems ManagerPhilip Visser Management Information

Systems and Internal Audit Manager

Quality Katrien De Vos ManagerResearch and Development Etienne Geirnaert DirectorSecretariat-General Filip Standaert Secretary-General

Board of directors and Auditor

Group managementBaron Karel Boone President

Managing directorMatthieu Boone Managing directorPieter Boone Non-executive director

ConsultantStanislas Boone Non-executive director

ConsultantJohan Boone Non-executive director

DentistJean-Luc Dehaene Independent director from

12/05/2000 Director of companies

Baron Paul De Keersmaeker Independent director till 12/05/2000 President of the Board ofDirectors of Interbrew

Chris Dewulf Independent directorPresident and C.E.O. of NetherlandsCar B.V. (NedCar)

Count Paul Lippens Independent directorPresident of the Board of Directors of Suikergroep NV

Antoine Stevens Non-executive directorRetired

Auditor: Ernst & Young Reviseurs d'Entreprises S.C.C. (B160) represented byMr. Erik De Lembre, partner. The auditor has been appointed for a period ofthree years till the Ordinary General Meeting of shareholders of 2001, deciding over the annual accounts of the year 2000. There is a proposal to reappointErnst & Young Reviseurs d’Entreprises S.C.C. (B160), represented byMr. Erik De Lembre and Mrs. Rosita Van Maele, as auditor,on the Ordinary General Meeting of May 11, 2001.

3534

VII. COMPOSITION OF THE BOARD OF DIRECTORSBoard of directors and Auditor

FINANCIAL STATEMENTS

Consolidated financial statements 38Balance after appropriation of profit 38Income statement 40Notes 42Comments 49Cash flow statement 52Auditor’s report 53

Financial statements of Lotus Bakeries NV 54Balance sheet after appropriation 54Income statement 56Notes 57Social report 64Valuation rules 66Comments 67Auditor’s report 68

3736

Belgium Matthieu Boone Managing DirectorAdministration Denis Pieters ManagerLogistics Johan Claerhout DirectorHuman resources (+ corporate) Rony Hoebeke DirectorProduction Bert De Wit Director

Eddy Thijs Technical Services ManagerJan Lievens Plant Manager LembekeEric Claeyssens Plant Manager OostakkerGuy Snackaert Plant Manager MeiseToon Hubrechts Plant Manager Turnhout

Sales and Marketing William Du Pré Director

The Netherlands Tim de Vries Managing DirectorAdministration and Finance Jan Groenewoud ManagerSales and Marketing Henk Onrust Director

France Jan Vander Stichele Managing DirectorAdministration Joseph Bultynck ManagerProduction Vincent Vigarié ManagerSales Régis Dutoit Manager

Joint venturesMargarinerie Hinnekens NV

Board of Directors Stanislas Boone PresidentKarel BooneMatthieu BooneHervé HinnekensLuc Hinnekens

Production Manager Els Van Parijs

Corona-Lotus Inc. (USA)Board of Directors Matthieu Boone Chairman

Michael W. Mc Guire President and C.E.O.Karel Boone Vice-President & TreasurerSandra E. Gale Vice-President & Secretary

Director Gary E. Payne

Lotus-Delta a.s. (Czech Republic)Board of Directors Marko Parik President

Karel Boone Matthieu BooneEdmond Müller

Director Stan Musil

Harry's Benelux NVBoard of Directors Karel Boone President

Matthieu BooneBernard DufayardAlain Strasser

Brand Manager Magd Havermans

Interwaffles NVBoard of Directors Gilles Samyn President

Karel Boone Matthieu Boone Maximilien de Limburg Stirum

General Manager Eric Taelemans

VIII. FINANCIAL STATEMENTS

3938

Consolidated financial statements

Consolidated balance after appropriation of profit

ASSETS in thousands of EUR 31-12-00 31-12-99

Fixed assets 60,862 49,903

I. Formation expenses 26 7

II. Intangible assets 7,364 6,005

III. Consolidation differences 2,244 2,573

IV. Tangible assets 50,737 38,834A. Land and buildings 16,602 16,234B. Plant, machinery and equipment 18,518 18,456C. Furniture and vehicles 3,055 2,750D. Leasing and other similar rights 393 -F. Assets under construction and advance payments 12,169 1,394

V. Financial assets 491 2,484A. Enterprises accounted for using the equity method 120 86

1. Participating interests 120 86B. Other enterprises 371 2,398

1. Participating interests and shares 26 1,3902. Amounts receivable 345 1,008

Current Assets 42,529 35,909

VI. Amounts receivable after one year 10 13B. Other amounts receivable 10 13

VII. Stocks and contracts in progress 7,712 6,858A. Stocks 7,712 6,858

1. Raw materials and consumables 5,464 5,0362. Work in progress 9 -3. Finished goods 2,072 1,1784. Goods purchased for resale 167 644

VIII. Amounts receivable within one year 20,459 17,776A. Trade debtors 16,047 14,744B. Other amounts receivable 4,412 3,032

IX. Investments 847 4,177A. Own shares 847 7B. Other investments and deposits - 4,170

X. Cash at bank and in hand 11,321 5,724

XI. Deferred charges and accrued income 2,180 1,361

TOTAL ASSETS 103,391 85,812

EQUITY AND LIABILITIES in thousands of EUR 31-12-00 31-12-99

Equity 25,443 24,071

I. Capital 1,371 1,371A. Issued capital 1,371 1,371

II. Share premium account 188 188

IV. Consolidated reserves 23,684 22,392

VI. Translation differences 184 99

VII. Investment grants 16 21

Minority interests

VIII. Minority interests 574 504

Provisions, deferred taxation 4,027 3,487

IX. A. Provisions for liabilities and charges 3,270 2,6961. Pensions and similar obligations 427 4092. Taxation3. Major repairs and maintenance 107 1174. Other liabilities and charges 2,736 2,170

B. Deferred taxation 757 791

Creditors 73,347 57,750

X. Amounts payable after more than one year 22,930 8,965A. Financial debts 22,645 8,965

3. Leasing and other similar obligations 314 -4. Credit institutions 22,288 8,9655. Other loans 43 -

D. Other amounts payable 285 -

XI. Amounts payable within one year 50,332 48,587A. Current portion of amounts payable after more than one year 8,389 2,993B. Financial debts 19,102 22,864

1. Credit institutions 19,102 22,864C. Trade debts 15,834 14,991

1. Suppliers 15,666 14,9912. Bills of exchange payable 168 -

E. Taxes. remuneration and social security 5,820 6,5341. Taxes 1,145 1,7452. Remuneration and social security 4,675 4,789

F. Other amounts payable 1,187 1,205

XII. Accrued charges and deferred income 85 198

TOTAL EQUITY AND LIABILITIES 103,391 85,812

4140

Consolidated income statement in thousands of EUR 2000 1999

I. Operating income 137,508 123,104A. Turnover 131,819 119,477B. Increase; Decrease in stocks of finished goods,

work and contracts in progress 783 (171)C. Fixed assets - own construction 1,189 1,081D. Other operating income 3,717 2,717

II. Operating charges (130,500) (116,390)A. Raw materials, consumables and goods for resale 56,291 50,800

1. Purchases 56,864 51,2582. Increase, decrease in stocks (573) (458)

B. Services and other goods 28,677 23,996C. Remuneration, social security costs and pensions 36,065 32,780D. Depreciation of and other amounts written off formation expenses,

intangible and tangible fixed assets 8,058 6,923E. Increase; Decrease in amounts written off stocks, contracts in progress and trade debtors 156 162F. Increase; Decrease in provisions for liabilities and charges 69 658G. Other operating charges 1,184 1,071

III. Operating profit 7,008 6,714

IV. Financial income 446 392B. Income from current assets 241 206C. Other financial income 205 186

V. Financial charges (3,272) (2,416)A. Interest and other debt charges 2,109 1,413B. Amounts written on positive consolidation differences 746 752D. Other financial charges 417 251

VI. Profit on ordinary activities before taxes 4,182 4,690

VII. Extraordinary income 527 222E. Gain on disposal of fixed assets 197 97F. Other extraordinary income 330 125

VIII. Extraordinary charges (585) (1,353)A. Extraordinary depreciation of and amounts written off formation expenses,

intangible and tangible fixed assets 327 - C. Amounts written off financial fixed assets 1 -D. Provisions for extraordinary liabilities and charges - (1,884)E. Loss on disposal of fixed assets 54 21F. Other extraordinary charges 203 3,216

2000 1999

IX. Profit for the year before taxation 4,124 3,559

X.A. Transfer from deferred taxation 21 17

X.B. Transfer to deferred taxation (14) (32)

XI. Income taxes (1,648) (1,209)A. Income taxes (1,665) (1,221)B. Adjustment of income taxes and write-back of tax provisions 17 12

XII. Profit for the year of the consolidated companies 2,483 2,335

XIII. Share in the result of the enterprises accounted for using the equity method 35 47

A. Profits 35 47

XIV. Consolidated profit 2,518 2,382A. Share of third parties 80 59B. Share of the group 2,438 2,323

APPROPRIATION ACCOUNT

A. Profit to be appropriated 2,438 2,323C. Transfer to equity (1,297) (1,206)F. Profit distribution Lotus Bakeries NV (1,141) (1,117)

4342

Notes on the consolidated financial statements

I. CONSOLIDATED COMPANIES AND COMPANIES ACCOUNTING FOR USING THE EQUITY METHODOn page 59 the addresses of the companies named below can be found inpoint V.A. of the explanation of the non-consolidated financial statements.

A. Full consolidationProportion of capital held in %

Lotus Bakeries NV 100.00 Margarinerie Hinnekens NV 55.00 Prilabis NV 99.52 Lotus Bakeries France SA 99.99 Biscuiterie Vander SA 99.87 Biscuiterie Le Glazik SA 99.96 Lotus Bakeries Réassurances SA 100.00 Lotus Bakeries GmbH 100.00 Corona-Lotus. Inc. 50.00 Cremers-Ribert NV 99.97 Lotus Bakeries Nederland BV 100.00 Swart Vicomte Ltd. 100.00 Biscuiterie Andi NV 100.00 Petit Breton SA 99.94 Lotus Bakeries Schweiz AG 99.00

B. Proportional consolidationHarry's Benelux NV 50.00 Interwaffles NV 50.00 Lotus-Delta a.s. 50.00Kelsen Bakery s.r.o. 50.00

C. Associated enterprise accounted for using the equity methodJeurgens Banket-. Biscuit- en Chocoladefabriek BV 33.25

V. CONSOLIDATION PROCEDURES

• Consolidated companies

The following companies were added tothe consolidation in 2000:

from January 1, 2000:

Lotus-Delta a.s. 50% Lotus Bakeries Schweiz AG 99%Harry's Benelux NV 50%

from July 1, 2000:Interwaffles NV 50%Kelsen Bakery s.r.o. 50%

All companies affiliated to the LotusBakeries Group were included in theconsolidation.

Lotus-Delta has been operational sinceDecember 1999. The December result isincluded in the consolidation of 2000.

• Consolidation methods

Full consolidation

The full consolidation method is used forcompanies which are directly or indirectlycontrolled by Lotus Bakeries NV, eitherde facto or de jure. The consolidatedfinancial statements are the result of theindividual financial statements of all thecompanies in the Lotus Bakeries Groupthat are included in the consolidation.

The headings of balance sheet andincome statements of consolidatedcompanies have been fully included inthe corresponding headings of the con-solidating company, with the exceptionof inter-company transactions and witha mention of the rights of third-partyshareholders and any consolidation dif-ference. Outside shareholder interestshave been identified in the balancesheets and income statements under

the heading of "minority interests".

Proportional consolidation

The proportional method is applied tothe joint ventures, except for the salesorganisations that only sell productsfrom the Lotus Bakeries Group, whichdetermined the policy implemented.These companies are consolidatedaccording to the full consolidationmethod. The headings of the balancesheet and the income statement of theconsolidated companies will be includedaccording to the share of the group inthe capital and added to the identicalheadings of the consolidating company.The inter-company transactions will beeliminated according to the share of thegroup in these transactions. Any consoli-dation difference will be expressed.

Equity method

Companies in which no exclusive or jointcontrol can be exercised on the policyorientation, but where there is a signifi-cant interest, qualify as affiliated compa-nies and are included in accordance withthe equity method. These are companiesin which at least 20%, but in principlenot more than 50% of the voting rightsare directly and indirectly retained.

In this method, the book value that theaffiliated company has in the company,is replaced by the corresponding sharein the equity of the affiliated company,after separating the consolidation differ-ences. The share in the results of theaffiliated company involved are men-tioned separately in the consolidatedprofit and loss account.

• Balance sheet date

All the companies included in the consoli-dation have 31 December as their ba-lance sheet date.

VI. A. METHODS OF VALUATION

1. In general

The consolidation for 2000 is in accor-dance with the Royal Decree on theconsolidation of financial statements,dated March 6, 1990. The assets andliabilities of all the separate companieshave been restated on the basis of stan-dard economic rules of valuation.

Where necessary, the presentation of thefinancial statements of affiliated compa-nies abroad has been rearranged inorder to bring them into line with thegeneral accounting system as applied inBelgium.

2. In particular

2.1 Formation costs

Establishment costs are written off on alinear basis over a period of five years.

2.2 Intangible and tangible fixed assets

The intangible and tangible fixed assetsare valued at their purchase value andincluded in the balance sheet for thatamount, after the appropriate deprecia-tion has been deducted. Purchase valuerefers to the purchase price, the manu-facturing price or the input price.

The depreciation and the net book valueof the fixed assets of the individual com-panies are reworked on the basis of eco-nomically sound group regulations. Theassets are written off on a linear basisfrom the month they come into use.

For this purpose the following percen-tages of depreciation have been applied.

Intangible fixed assets:• research and development 33%• licences 33%• clients 10%

The depreciation of clients over ten yearsis justified by the stable client relation-ships that have been realized throughthe brands Lotus, Corona, Cremers andSuzy.

Tangible fixed assets:• buildings 5%• installations and equipment 10%• basic machinery 10%• current machines, equipment,

furniture 20%• equipment subject to fast wear

and tear, software 33%• vehicles 20%

Assets under construction and advancepaymentsInvestments and advances on invest-ments that have been put forward butnot yet concluded are not written off.

2.3 Financial assets

Participating interests and socialrightsThe shareholding is included in the con-solidated balance sheet as the amountthat corresponds to the share of equityof the company involved, including theresults for the accounting year that thisshareholding embodies.

Social rights are valued at their purchaseprice.

Depreciation is applied where the esti-mated value of the financial fixed assetsis less than the accounting value andwhere the loss of value so determined isof a lasting nature in the opinion of theBoard of Directors. Depreciations are taken back to the sumof the previously recorded depreciationswhere the valuation at the conclusion ofthe accounting period concerned signifi-cantly exceeds the previous valuation.

Amounts receivable

Receivables are valued at their nominalvalue.

Reduction in value is applied if there isuncertainty about full or part payment onthe due date.

Reduction in value is not enforced to theextent that it is higher at the end of theaccounting year than is required accord-ing to current rating.

2.4 Stocks

Finished products were valued at stan-dard production cost price.Raw materials, consumables and goodsfor resale were booked at the cost ofacquisition using the FIFO method.For stocks, real depreciation was appliedin the event that they had become use-less or if their practical value or realisa-tion value was lower than the cost price.

2.5 Amounts receivable

The receivables are booked at theirnominal value, after deducting the creditnotes still to be made.Receivables in foreign currencies wereconverted at the exchange rate applyingon the balance sheet date. Negative

exchange rate differences were includedin the income statement.The necessary depreciation has beenapplied for receivables the collection ofwhich is in doubt.

2.6 Investments & cash at bank andin hand

Company shares are valued at their pur-chase price.Securities are valued at their purchaseprice.Balances with financial institutions arevalued at their nominal value.

2.7 Investment grants

Capital subsidies are valued at theirnominal value after deducting thedeferred taxation.Deferred taxation will be expressed inthe column deferred taxation.

2.8 Provisions for liabilities andcharges

Provisions have been made for all nor-mally foreseeable liabilities and charges.

2.9 Amounts payable

Debts have been booked at their nomi-nal value.

Debts in foreign currencies have beenvalued at the rate of exchange on thebalance date. Negative exchange ratedifferences were included in the incomestatement.

The anticipated debts with regard to single and double holiday allowances,redistribution of social security chargesand personnel insurance have beenbooked in full.

2.10 Positive consolidation differ-ences

The consolidation goodwill or positivedifference on consolidation defined asthe difference between the purchasevalue of the shares and the correspon-ding share in the adjusted equity capitalon the movement of acquisition, isdepreciated over a period of 5 years.

2.11 Negative consolidation differ-ences

The maximum allocations to the indivi-dual assets and liabilities items wereused for the negative consolidation differ-ences.

4544

2.12 Conversion of currency

The financial statements of foreign com-panies have been translated into Belgianfrancs at the rates of exchange on thebalance day as far as balance sheetaccounts are concerned, and at theaverage rates of exchange of the financialyear for profit and loss accounts.Historical exchange rates have beenapplied for equity. Any translation differ-ences have been recorded under a sepa-rate heading of equity called "Translationdifferences". From 1995, the consolida-ted result has been included in the con-solidated reserves at the average rate ofexchange.

VI.B. FUTURE TAXATION AND DEFERRED TAXES in thousands of EUR 2000

Analysis of heading IX.B. of the liabilities 757• Future taxation 757

VII. STATEMENT OF FORMATION EXPENSES in thousands of EUR 2000

Net book value as at the end of the preceding year 7Movements during the year:• New expense incurred 27• Depreciation (9)• Other 1

Net book value at the end of the year 26of which:• Expenses of formation or capital increase, loan issue expenses,

reimbursement premium and other formation costs 26

VIII. STATEMENT OF INTANGIBLE ASSETS in thousands of EUR

Research and Concessions, Goodwill Advance Development Patents, payments

Expenses Licences, etc.a) ACQUISITION COST

At the end of the preceding year 13 251 7,171 -Movements during the year:

• Acquisition, including fixed assets, own production - - 401 179• Sales and disposals - (2) - -• Other movements (1) 6 7 1,501 -

At the end of the year 19 256 9,073 179

c) DEPRECIATION AND AMOUNTS WRITTEN DOWNAt the end of the preceding year 13 158 1,259 -Movements during the year:

• Recorded - 30 695 -• Written down after sales and disposals - (2) - -• Other movements (1) 6 4 - -

At the end of the year 19 190 1,954 -

d) NET BOOK VALUE AT THE END OF THE YEAR - 66 7,119 179

(1) Movements originating in changes of the consolidation scope

IX. STATEMENT OF TANGIBLE FIXED ASSETS in thousands of EUR

Land and Plant, Furniture Leasing Other Assets under buildings machinery and and other tangible construction

and vehicles similar assets and advanceequipment rights payments

a) ACQUISITION COSTAt the end of the preceding year 27,883 76,928 11,376 - - 1,394Movements during the year:

• Acquisitions including fixed assets, own production 2,014 4,686 1,354 393 - 9,656

• Sales and disposals (2,464) (3,955) (609) (28) - (2)• Transfers from one heading to another 39 265 18 - - (322)• Translation differences - - 8 - - -• Other movements (1) 1,641 4,081 341 28 4 1,443

At the end of the year 29,113 82,005 12,488 393 4 12,169

c) DEPRECIATION ANDAMOUNTS WRITTEN DOWNAt the end of the preceding year 11,648 58,471 8,627 - - -Movements during the year:

• Recorded 1,033 5,407 1,209 2 - -• Written down after

sales and disposals (762) (4,023) (534) (16) - -• Transfers from one heading to another - 88 (88) - - -• Translation differences 2 - 5 - - -• Other movements (1) 590 3,544 214 14 4 -

At the end of the year 12,511 63,487 9,433 - 4 -

d) NET BOOK VALUE AT THE END OF THE YEAR 16,602 18,518 3,055 393 - 12,169

of which: plant, machinery and equipment 393(1) Movements originating in changes of the consolidation scope

X. STATEMENT OF FINANCIAL FIXED ASSETS in thousands of EUR

Enterprises Other accounted for enterprises

using theequity method

1. Participating interestsa) ACQUISITION COST

At the end of the preceding year 85 1,427Movements during the year:

• Acquisitions - 20• Transfers from one heading to another - (1,373)

At the end of the year 85 74

c) AMOUNTS WRITTEN DOWNAt the end of the preceding year - -Movements during the year:

• Recorded - 1At the end of the year - 1

4746

Enterprises Other accounted for enterprises

using theequity method

d) UNCALLED AMOUNTSAt the end of the preceding year - 37Movements during the year - 10At the end of the year - 47

e) MOVEMENTS IN THE CAPITAL AND RESERVES OF THE ENTERPRISES ACCOUNTED FOR USING THE EQUITY METHOD 35 -

• Share in the result for the financial period 35 -

NET BOOK VALUE AT THE END OF THE YEAR 120 26

2. Amounts receivableNET BOOK VALUE AT THE END OF THE PRECEDING YEAR - 1,008

Movements during the year:• Additions - 320• Reimbursements - (984)• Other - 1

NET BOOK VALUE AT THE END OF THE YEAR - 345

XI. STATEMENT OF CONSOLIDATED RESERVES in thousands of EUR 2000

Consolidated reserves at the end of the previous financial period 22,392Movements:

• Shares of the group in the consolidated income 2,438• Diminution due to distribution (1,141)• Other modifications (investment grants, …) (5)Consolidated reserves at the end of the financial period 23,684

XII. STATEMENT OF CONSOLIDATION DIFFERENCES AND DIFFERENCES RESULTING FROM THE APPLICATION OF THE EQUITY METHOD in thousands of EUR 2000

Consolidation Differencesdifferences resulting from

the applicationof the equity

methodpositive positive

Net book value at the end of the preceding year 2,512 60Movements during the year

• Arising from an increase of the percentage held 417 -• Write-downs (725) (20)• Other modifications 20 (20)

NET BOOK VALUE AT THE END OF THE YEAR 2,224 20

XIII. STATEMENT OF AMOUNTS PAYABLE in thousands of EUR 2000

A. ANALYSIS OF THE AMOUNTS ORIGINALLY PAYABLE AFTER ONE YEARACCORDING TO THEIR RESIDUAL TERM

Amounts payable with a residual term of: not more between 1 over 5 yearsthan 1 year and 5 years

Financial debts 8,389 22,004 6413. Leasing and other similar obligations 79 314 -4. Credit institutions 8,310 21,647 6415. Other loans - 43 -

Other amounts payable - 285 -

TOTAL 8,389 22,289 641

B. AMOUNTS PAYABLE, OR THE PORTION THEREOF, WHICH GUARANTEED BY REAL GUARANTEES GIVEN OR IRREVOCABLY PROMISED ON THE ASSETS OF THE COMPANIES INCLUDED IN THE CONSOLIDATION

Guaranteed amountspayable by real

guaranteesFinancial debts 1,774

4. Credit institutions 1,774

TOTAL 1,774

XIV. RESULT FOR THE FINANCIAL PERIOD AND THE PREVIOUS FINANCIAL PERIOD

A. NET TURNOVER in thousands of EUR period preceding period A.2. Aggregate turnover of the group in Belgium 54,243 49,012

B. AVERAGE NUMBER OF PERSONS EMPLOYED in units 2000 1999AND PERSONNEL CHARGES in thousands of EUR

B.1. Fully consolidated enterprisesB.11. Average number of persons employed 1,048 1,018Workers 761 721Employees 258 271Management personnel 29 26B.12. Personnel chargesRemunerations and social charges 35,003 32,728Pension costs 53 52B.13. Average number of persons employed in Belgium by companies of the group 699 672

B.2. Proportionnally consolidated enterprisesB.21. Average number of persons employed 155 -Workers 118 -Employees 35 -Management personnel 2 -B.22. Personnel chargesRemunerations and social charges 1,003 -Pension costs 6 -B.23. Average number of persons employed in Belgium by companies of the group 93 -

4948

XV. RIGHTS AND COMMITMENTS NOT REFLECTED IN THE BALANCE SHEET in thousands of EUR 2000

A.2. Amount of real guarantees, given or irrevocably promised by the enterprises included in the consolidation on their own assets, as security for debts and commitments:

• of enterprises included in the consolidation 3,068

A.5. b) Commitments from transactions• to exchange rates 10,038• to prices of raw materials or goods purchased for resale 7,941

XVI. RELATIONSHIPS WITH AFFILIATED ENTERPRISES AND ENTERPRISES LINKED BY PARTICIPATING INTERESTS BUT NOT INCLUDED IN THE CONSOLIDATION

Affiliated enterprisesPeriod Preceding period

1. Financial fixed assetsParticipating interests and shares - 1,373

2. Amounts receivable - 403Within one year - 403

4. Amounts payable - 21Within one year - 21

XVII. FINANCIAL RELATIONSHIPS WITH DIRECTORS OR MANAGERSOF THE CONSOLIDATION ENTERPRISE in thousands of EUR 2000

A. Total amount of remuneration granted in respect of the period to the directors or managers of the consolidation company for their responsibilities in the consolidation company, its subsidiaries and its affiliated companies, including the amounts in respect of retirement pensions granted to former directors or managers 455

Additional information:Lotus Bakeries NV bought 12,553 company shares in 2000. On december 31, 2000 the total package consisted of 12,659 shares and represented 1,7% of the total number of shares, which is 750,537 shares.

Comments on the consolidatedfinancial statements

1.The consolidated accounts were cal-culated after the proposed LotusBakeries profit sharing.

2.Assets

The intangible fixed assets rose by1.36 million EUR, principally as a result ofthe expansion of the consolidation toinclude Interwaffles NV as from 1 July2000, and Lotus-Delta.

The increase in the tangible fixed assetsis almost entirely due to the assets underconstruction. This relates mainly to themajor investment in the new factory ofInterwaffles NV at Courcelles. This invest-ment was brought into operation at theend of January 2001.

The reduction in the financial fixed assetscan principally be explained by the effective inclusion of the joint ventureLotus-Delta in the consolidation, giventhat this company has only been opera-tional since December 1999. An increasein capital was also implemented inLotus-Delta with the conversion of debtsinto capital. The minority participation ofLotus Bakeries Nederland in JeurgensBanket, Biscuit- and ChocoladefabriekBV is the most significant participation.The equity method was applied to this.

The stocks rose by 0.85 million EUR.This is mainly declared by the expansionof the consolidation.

The trade debtors rose by 1.3 millionEUR. The most important reason for thisis the expansion of the consolidation withInterwaffles NV and Lotus-Delta a.s. Theaverage number of customer credit daysreduced by 1 day to 44 days.

The increase in the other amountsreceivable was 1.38 million EUR andcan chiefly be explained by the claimmade by Interwaffles for damages still tobe received from the insurance as aresult of the fire in Buizingen. Otherwise,this post mostly concerns indirect anddirect taxes to be reclaimed.

The share of the current assets as partof the total assets fell slight by 0.72% to41.13%. This is the result of the sharpincrease in the tangible fixed assets cau-sed by the major investment made byInterwaffles.

3.Liabilities

The provisions for liabilities and chargesrose by 0.57 million EUR. This is mostlydue to the expansion of the consolida-tion. The most important post in thissection relates to the provision madewith Lotus Bakeries Réassurances tocover risks that are difficult to insure.

The amounts payable after more thanone year increased by 13.68 millionEUR. The most important reasons forthis are:• financing of the 50% participation in

Interwaffles and Harry's Benelux• expansion of the consolidation to

include Interwaffles and Lotus-Delta• conversion of short-term credits into

long-term credits.

This conversion resulted in a fall in theshort-term financial debts. Due to thelower short-term interest rate, a conside-rable portion of the financing was kept inshort term credits. The rent risk of this iscovered in the long term with appropria-te financial instruments.

The more than proportional increase infinancial debts, mainly caused by thefinancing of the new joint ventures, has

reduced the solvency by 3.44% to24.61%. The financing of these invest-ments in future-oriented activities hasnaturally not yet made a positive contri-bution to the results and equity in 2000.The liquidity ratio rose by 0.1% to 0.84%.If however, we compare the solvencyand liquidity of the Lotus Bakeries confi-guration 1999 with that of financial year1999, then we see clearly that there is animprovement in the solvency ratio by4.95% to 32.99%, and in the liquidityratio by 0.22% to 0.96%.

4. Income statement

Operating income rose by 11.7% to137.51 million EUR. Turnover rose by12.34 million EUR or 10.33%. This increasein turnover is mainly due to internalgrowth and to sales under the Suzybrand name, and is also partly explainedby the expansion of the consolidation.

The gross operating margin fell slightlyby 0.55% and stood at 11.28% for2000. The most important reasonsbehind this are the difficult and unprofita-ble situation in which Interwaffles hasfound itself in 2000, and the associatedhigher purchase price of goods for resale.This means that the gross operatingmargin for the basic activities remainedat the same level as 1999.

Through the expansion of the consolida-tion and greater sales- and marketingefforts the services and other goodspost rose by 4.68 million EUR.

Despite the difficult circumstances inwhich Interwaffles was operating and theintegration- and restructuring effects inLe Glazik, Lotus Bakeries Nederlandand Cremers-Ribert, the increase inremuneration and social securitycosts was limited to 10%, which is lowerthan the evolution of the operating income.

Statement of the financial debts originally payableafter one year of the Lotus Bakeries Group itemised by due date in thousands of EUR

Debts falling 2001 2002 2003 2004 2005 later Total

Financial debts• Leasing debts and

similar debts 79 79 79 79 79 - 395• Credit institutions 8,310 7,264 6,533 4,618 3,230 641 30,596• Other loans - - 43 - - - 43

TOTAL 8,389 7,343 6,655 4,697 3,309 641 31,034

5150

The share of personnel costs in theadded value thus rose by 0.78% to68.64%. However if we compare this tothe Lotus Bakeries configuration 1999,then the share of the personnel costs inthe added value is approximatelyunchanged relative to 1999.

The reduction in the provisions by 0.59million EUR, relates mainly to an appro-priation in the Netherlands of a provisionfor restructuring.

Due to the high level of investments inthe last couple of years and the expan-sion of the consolidation the deprecia-tions rose by 1.14 million EUR. Thisrepresents a share of 15.34% in theadded value, or a rise of 1.01%.

The operating profit rose by 0.29 millionEUR. this being 4.38%. This increasewas much restricted by the negativeresults of the new joint ventures, wherethe costs should in principle be asses-sed as market investments. The LotusBakeries configuration 1999 saw its operating profit rise by 0.85 million EUR,or 12.72%, despite the worse thanexpected results at Cremers-Ribert,Lotus Bakeries Nederland and Le Glazik,In particular the operating results ofLotus Bakeries NV, of Lotus BakeriesFrance and of Biscuiterie Vander demon-strated a considerable increase.

The larger financial debts, that were prin-cipally the consequence of the participa-tions in the joint ventures, and the higherinterest rates meant that the financialcosts of debts rose by 0.7 million EUR.

The net financial charges, defined asfinancial result excluding depreciationson consolidation differences, amountedto 3.96% of the added value comparedto 2.63% in 1999. Calculated on thebasis of the Lotus Bakeries ’99 configu-ration, these amounted to 3.15% of theadded value.

These higher net financial charges, hig-her taxes and the negative results in thenew joint ventures all reduced the cur-rent net result by 0.94 million EUR. Inrelation to the operating income the cur-rent net results were 2.42% comparedwith 3.46% in 1999. Within the LotusBakeries ’99 configuration the currentnet results show a slight rise of 1.48%and amount to 3.21% of the operatingincome.

The current net cash flow, defined ascurrent net result increased by deprecia-tions, provisions and amounts written off,amounts to 11.6 million EUR. Comparedto the operating income, the current netcash flow is 8.43% compared to 9.76%in 1999. The current net cash flow nowamounts to 30.55% of the net financial

debts (defined as the financial debtsreduced by investments and cash atbank and in hand). For the LotusBakeries ’99 configuration the currentnet cash flow was 12.32 million EUR or9.14% of the operating income.Compared to the net financial debts thisrepresents 49.47%.

The depreciations on the positive con-solidation differences are included inthe section financial charges and amountto 0.75 million EUR.

The other extraordinary chargesconsist of restructuring costs atCremers-Ribert. The two companies,Cremers NV and Biscuiterie Ribert NV,were merged in 2000 to form a singlecompany Cremers-Ribert NV. The extra-ordinary income includes supplementaryreimbursements in relations to the dioxincrisis. In 1999 the extraordinary resultswere noticeably influenced by the conse-quences of the dioxin crisis.

The net result rose by 0.14 million EURor 5.88%. The net cash flow was 11.89million EUR compared to 8.96 millionEUR in 1999. This represents an increa-se of 32.7%. According to the LotusBakeries ’99 configuration, the net resultamount to 3.81 million EUR, which is anincrease of 63.37%, compared to 1999.

5.Financing

The increase in the treasury resultingfrom operating activities amounted to7.74 million EUR, principally through thelarger net cash flow. This increase is limited through the reduction of the trade debts and other debts. The large investments in tangible fixed assets andparticipations were in part financed withequity, but also to a significant extentthrough external funding. In part asresult of the higher external funding therewas a net increase in the treasury of2.27 million EUR. In comparison to 1999,the inclusion of the new joint ventures in the figures for 2000 should be takeninto consideration.

Financial ratios in % of operating income

2000 1999 1998 1997 1996

• Days customer credit 44.00 45.00 47.00 47.00 37.00• Solvency ratio (%) 24.61 28.05 30.91 33.94 40.88• Liquidity ratio (Current ratio) 0.84 0.74 0.89 0.99 0.99• Gross operating margin (%) 11.28 11.83 11.22 13.93 14.22• Current net profit/

Operating income (%) 2.42 3.46 3.13 3.73 3.85• Current net cash flow/

Operating income (%) 8.43 9.76 8.90 10.85 11.68• Current net cash flow/

Net financial debts (%) 30.55 48.23 51.15 106.80 197.41• Current net cost-effectiveness

of equity (%) 13.06 17.71 14.35 16.22 16.29

5352

CASH FLOW STATEMENT in thousands of EUR

2000 1999

Net cash flow 11,887 8,960Change in stocks (880) (450)Change in trade debtors (1,433) (1,701)Change in other debtors (1,380) (443)Change in deferred charges and accrued income (820) 58Change in trade creditors 844 4,201Change in other creditors (731) 1,658Change in accrued charges and deferred income (114) (328)Change in receivable after one year 3 3Change in provisions 506 (21)Change in deferred taxation (28) (41)

Change in operating net working capital (4,032) 2,937Gain on disposal of fixed assets (197) (97)Exchange translation differences from other items than from fixed assets 85 12

Increase in cash provided (used in) operating activities 7,744 11,811

Investing activitiesSale of intangible and tangible fixed assets 1,865 686Purchase of tangible fixed assets (21,276) (13,617)Purchase of intangible fixed assets (2,084) (2,893)Purchase of formation expenses (28) -Change in financial assets 2,027 (951)Consolidated participating interests (432) (922)

Decrease in cash provided by (used in) investing activities (19,928) (17,697)Free cash flow for financing activities (12,184) (5,886)

Financing activitiesDividends and director's emoluments to be paid (1,141) (1,117)Increase of capital - 195Change in long-term financial debt 22,353 4,144Repayment of current portion of amountspayable after one year (2,993) (3,013)Change in short-term financial debt (3,762) 5,643Investment grants (6) (6)

Increase of cash provided by (used in) financing activities 14,451 5,847NET INCREASE IN CASH 2,267 (39)

at the beginning of the financial year 9,901 9,940at the end of the financial year 12,168 9,901

CHANGE IN CASH 2,267 (39)

Auditor’s report on the consoli-dated financial statements forthe year ended december 31, 2000

To the shareholders’ meeting of LotusBakeries NV

In accordance with legal and regulatoryrequirements, we are pleased to reportto you on the performance of the auditmandate which you have entrusted to us.

We have audited the consolidated finan-cial statements as of and for the yearended December 31, 2000 which havebeen prepared under the responsibility ofthe board of directors and which show a balance sheet total of 103,391 thou-sands of EUR and a consolidated profitfor the year of 2,518 thousands of EUR.We have also examined the consolidateddirectors’ report.

Unqualified audit opinion on theconsolidated financial statements

We conducted our audit in accordancewith the standards of the “Institut desReviseurs d’Entreprises/Instituut derBedrijfsrevisoren”. Those standardsrequire that we plan and perform theaudit to obtain reasonable assuranceabout whether the consolidated financialstatements are free of material misstate-ment, taking into account the legal andregulatory requirements applicable toconsolidated financial statements inBelgium.

In accordance with those standards, weconsidered the group’s administrativeand accounting organisation, as well asits internal control procedures. We have

obtained explanations and informationrequired for our audit. We examined on a test basis, evidence supporting theamounts in the consolidated financialstatements. We have assessed the vali-dity of the accounting principles, theconsolidation policies and significantaccounting estimates made by the company, as well as the overall presen-tation of the consolidated financial statements. We believe that those procedures provide a reasonable basisfor our opinion.

In our opinion the consolidated financialstatements give a true and fair view ofthe group’s assets, liabilities and consoli-dated financial position as of December31, 2000 and the consolidated results ofthe operations for the year then ended,in accordance with the legal and regula-tory requirements applicable in Belgiumand the information given in the notes tothe consolidated financial statements isadequate.

The consolidated directors’ report contains the information required by lawand is consistent with the consolidatedfinancial statements.

Ghent, April 13, 2001Ernst & Young Reviseurs d'EntreprisesS.C.C. (B 160)

Auditorrepresented byERIK DE LEMBRE,Partner

5554

Financial statements of Lotus Bakeries NVBalance sheet after appropriation

ASSETS in thousands of EUR 31-12-00 31-12-99

Fixed Assets 53,555 44,224

II. Intangible assets 5,785 6,153

III. Tangible assets 12,884 11,752A. Land and buildings 5,179 5,488B. Plant, machinery and equipment 3,448 4,244C. Furniture and vehicles 1,029 904F. Assets under construction and advance payments 3,228 1,116

IV. Financial assets 34,886 26,319A. Affiliated enterprises 34,792 25,327

1. Participating interests 31,980 22,7962. Amounts receivable 2,812 2,531

C. Other financial assets 94 9921. Shares 26 162. Amounts receivable and cash guarantees 68 976

Current Assets 21,604 22,092

VI. Stocks and contracts in progress 3,199 2,927A. Stocks 3,199 2,927

1. Raw materials and consumables 1,904 2,0372. Work in progress 9 -3. Finished goods 711 4714. Goods purchased for resale 575 419

VII. Amounts receivable within one year 15,114 15,589A. Trade debtors 13,744 12,366B. Other amounts receivable 1,370 3,223

VIII. Investments 847 7A. Own shares 847 7B. Other investments and deposits - -

IX. Cash at bank and in hand 1,638 2,812

X. Deferred charges and accrued income 806 757

TOTAL ASSETS 75,159 66,316

LIABILITIES in thousands of EUR 31-12-00 31-12-99

Capital and reserves 15,905 15,122

I. Capital 1,371 1,371A. Issued capital 1,371 1,371

II. Share premium account 188 188

IV. Reserves 14,330 13,542A. Legal reserve 137 137B. Reserves not available for distribution 918 79

1. In respect of own shares held 846 72. Other 72 72

C. Untaxed reserves 826 830D. Reserves available for distribution 12,449 12,496

VI. Investment grants 16 21

Provisions and deferred taxation 1,637 1,557

VII. A.Provisions for liabilities and charges 1,423 1,3371. Pensions and similar obligations 195 1693. Major repairs and maintenance 192 1984. Other liabilities and charges 1,036 970

B. Deferred taxation 214 220

Creditors 57,617 49,637

VIII. Amounts payable after more than one year 22,228 8,282A. Financial debts 21,988 7,230

4. Credit institutions 21,988 7,230D. Other amounts payable 240 1,052

IX. Amounts payable within one year 35,212 41,256A. Current portion of amounts payable after more than one year 8,152 2,589B. Financial debts 14,949 22,370

1. Credit institutions 14,949 22,370C. Trade debts 8,054 11,854

1. Suppliers 8,054 11,854E. Taxes, remuneration and social security 2,820 3,045

1. Taxes 579 6162. Remuneration and social security 2,241 2,429

F. Other amounts payable 1,237 1,398

X. Accrued charges and deferred income 177 99

TOTAL LIABILITIES 75,159 66,316

5756

Not-consolidated income statement in thousands of EUR 2000 1999

I. Operating income 91,356 79,645A. Turnover 84,253 75,023B. Increase; Decrease in stocks of finished goods, work

and contracts in progress 250 (207)C. Own construction capitalised 658 453D. Other operating income 6,195 4,376

II. Operating charges (88,192) (77,323)A. Raw materials, consumables and goods for resale 50,604 43,920

1. Purchases 50,630 44,1412. Increase, decrease in stocks (26) (221)

B. Services and other goods 14,477 11,642C. Remuneration, social security costs and pensions 17,605 17,144D. Depreciation of and other amounts written off formation expenses,

intangible and tangible fixed assets 4,946 4,484E. Increase; Decrease in amounts written off stocks, contracts in progress and trade debtors 63 22F. Increase; Decrease in provisions for liabilities and charges 86 (233)G. Other operating charges 411 344

III. Operating profit 3,164 2,322

IV. Financial income 1,200 2,376A. Income from financial fixed assets 1,021 2,138B. Income from current assets 41 81C. Other financial income 138 157

V. Financial charges (2,290) (1,591)A. Interest and other debt charges 1,888 1,188C. Other financial charges 402 403

VI. Profit on ordinary activities before taxes 2,074 3,107

VII. Extraordinary income 636 766D. Gain on disposal of fixed assets 40 92E. Other extraordinary income 596 674

VIII. Extraordinary charges (19) (1,591)C. Provisions for extraordinary liabilities and charges - -D. Loss on disposal of fixed assets 3 1E. Other extraordinary charges 16 1,590

IX. Profit for the year before taxes 2,691 2,282

IX. bisA. Transfer from deferred taxation 19 15B. Transfer to deferred taxation (13) (32)

X. Income taxes (767) (228)A. Income taxes (767) (234)B. Adjustment of income taxes and write-back of tax provisions - 6

XI. Profit for the year 1,930 2,037

XII. Transfer from untaxed reserve 22 17Transfer from untaxed reserve (19) (48)

XIII. Profit for the year available for appropriation 1,933 2,006

APPROPRIATION ACCOUNT in thousands of EUR

A. Profit to be appropriated 1,933 2,0061. Profit for the year available for appropriation 1,933 2,006

B. Transfers from capital and reserves 840 72. From reserves 840 7

C. Transfer to capital and reserves (1,632) (897)2. To legal reserve - 13. To other reserves 1,632 896

F. Distribution of profit (1,141) (1,116)1. Dividends 1,042 1,0362. Directors' emoluments 99 80

Notes on the not-consolidated financial statements

II. STATEMENT OF INTANGIBLE ASSETS in thousands of EUR

Research and Concessions, Goodwill AdvanceDevelopment Patents, payments

Expenses Licences, etc.a) ACQUISITION COST

At the end of the preceding year 13 186 7,528 -Movements during the year:

• Acquisition, including produced fixed assets - - 248 179At the end of the year 13 186 7,776 179

c) DEPRECIATION AND AMOUNTS WRITTEN DOWNAt the end of the preceding year 13 169 1,392 -Movements during the year:

• Recorded - 17 778 -At the end of the year 13 186 2,170 -

d) NET BOOK VALUE AT THE END OF THE YEAR - - 5,606 179

5958

III. STATEMENT OF TANGIBLE FIXED ASSETS in thousands of EUR

Land Plant, Furniture Assets underand machinery, and construction

buildings and equipment vehicles and advancea) ACQUISITION COST payments

At the end of the preceding year 10,888 42,630 8,055 1,170Movements during the year:

• Acquisitions, including produced fixed assets 181 1,331 901 2,895• Sales and disposals - (13) (331) -• Transfers from one heading to another - - 126 (126)

At the end of the year 11,069 43,948 8,751 3,939

c) DEPRECIATION AND AMOUNTS WRITTEN DOWNAt the end of the preceding year 5,401 38,385 7,151 53Movements during the year:

• Recorded 489 2,127 877 658• Written down after sales and disposals - (12) (306) -

At the end of the year 5,890 40,500 7,722 711

d) NET BOOK VALUE AT THE END OF THE YEAR 5,179 3,448 1,029 3,228

IV. STATEMENT OF FINANCIAL FIXED ASSETS in thousands of EUR

Affiliated Othersenterprises

1. Participating interests and sharesa) ACQUISITION COST

At the end of the preceding year 22,797 53Movements during the year:

• Acquisitions 9,189 20• Sales and disposals (6) -

At the end of the year 31,980 73

d) UNCALLED AMOUNTSAt the end of the preceding year - 37Movements during the year - 10At the end of the year - 47

NET BOOK VALUE AT THE END OF THE YEAR 31,980 26

2. Amounts receivableNET BOOK VALUE AT THE END OF THE PRECEDING YEAR 2,530 976

Movements during the year:• Additions 537 48• Reimbursements (255) (956)

NET BOOK VALUE AT THE END OF THE YEAR 2,812 68

V. A. PARTICIPATING INTERESTS AND OTHER RIGHTS IN OTHER ENTERPRISES

Name and registered offices Rights held by % Subsidiariesand for an enterprise governed the enterprise %by Belgian Law, the VAT number (directly)

number Cremers-Ribert NV

Gentstraat 52, B-9971 Lembeke BE 427.808.008 3,008,453 99.99 0.01

Margarinerie Hinnekens NVKerkstraat 33 B, B-9971 Lembeke BE 421.694.038 3,500 35.00 20.00

Prilabis NVOssegemstraat 20, B-1860 Meise BE 429.881.828 1,244 99.52 -

Biscuiterie Andi NVGentstraat 52, B-9971 Lembeke BE 443.714.127 395 98.75 1.25

Harry's Benelux NVGentstraat 52, B-9971 Lembeke BE 470.995.079 1,500 50.00 -

Interwaffles NVRue de Liège, B-6180 Courcelles BE 439.312.406 3,396 50.00 -

Lotus Bakeries France SAPlace du Château BP 91, F-59560 Comines 43,434 99.99 -

Biscuiterie Vander SAPlace du Château BP 91, F-59560 Comines - - 99.86

Biscuiterie Le Glazik SAZone Industrielle 2, F-29510 Briec-de-l'Odet - - 99.96

Petit Breton SAZ.A. De Kergazuel, F-29930 Pont-Aven - - 99.94

Lotus Bakeries Nederland BVElektronstraat 15, NL-1014 AP Amsterdam 2,000 100.00 -

Corona-Lotus Inc.Green Street 465, San Francisco California 94133 U.S.A. - - 50.00

Lotus Bakeries GmbHSchumanstrasse 33, D-52146 Würselen 10,000 100.00 -

Lotus Bakeries Réassurances SAAvenue de la Faïencerie 148, L-1511 Luxembourg 4,995 99.90 0.10

Lotus - Delta a.s.Bohunická 24, CZ-61900 Brno 835 50.00 -

Kelsen Bakery s.r.o.Bohunická 24, CZ-61900 Brno - 100.00 -

Lotus Bakeries Schweiz AGBahnhofstraße 276, CH-4563 Gerlafingen 198 99.00 -

Swart Vicomte Ltd.Dudley House, Kings Road, Fleet, GB-GU13 9AA Hampshire - 100.00 -

6160

VIII. STATEMENT OF CAPITAL

A. CAPITAL Amounts Number ofin thousands of EUR shares

1. Issued capitalAt the end of the preceding year 1,371At the end of the year 1,371

2. Structure of the capital2.1. Different categories of sharesOrdinary shares 1,371 750,5372.2. Registered shares and bearer sharesRegistered 383,933Bearer 366,604

C. Own shares held bythe company itself 23 12,659

E. AMOUNTS OF AUTHORIZED CAPITAL, NOT ISSUED 1,356

G. STRUCTURE OF SHAREHOLDINGS OF THE ENTERPRISE: Situation at December 31, 2000As applied by article 4 paragraph 2 of the Law of March 2, 1989. the following notifications of participation in the shares representing the capital of the company have been received.

Announcer Number Percentage of shares of total number

of shares• Bisinvest NV (*), Gentstraat 52, 9971 Lembeke 450,353 60.00%• Group of natural persons who own each less than 5%

of the voting rights and who act in concert with Bisinvest NV 73,397 9.78%• Axa Royale Belge NV 44,769 5.97%

TOTAL 568,519 75.75%(*) Bisinvest NV is controlled by "Stichting Administratiekantoor van Aandelen Bisinvest" in the Netherlands.

IX. PROVISIONS FOR OTHER LIABILITIES AND CHARGES in thousands of EUR 2000

Provision Artis-Historia points 971

X. STATEMENT OF AMOUNTS PAYABLE in thousands of EUR

A. ANALYSIS BY CURRENT PORTIONS OF AMOUNTS INITIALLY PAYABLE AFTER MORE THAN ONE YEAR

Amounts payable current portion not more than between one over fiveone year and five years

years

Financial debts 8,152 21,347 6414. Credit institutions 8,152 21,347 641

Other amounts payable - 240 -

TOTAL 8,152 21,587 641

C. AMOUNTS PAYABLE FOR TAXES, REMUNERATION AND SOCIAL SECURITY2000

1. Taxesb) Non expired taxes payable 363c) Estimated taxes payable 216

2. Remuneration and social securityb) Other amounts payable relating to remuneration and social security 2,241

XII. OPERATING RESULTS in thousands of EUR except C1 and G 2000 1999

B. OTHER OPERATING INCOMEWhereof subsidies (other than investments grants) and compensatory amounts obtained from public authorities 351 314

C1. EMPLOYEES RECORDED IN THE PERSONNEL REGISTERa) Total number at closing date 549 528b) Average number of employees in full-time equivalents 477.2 469.0c) Number of actual working hours 725,476 710,204

C2. PERSONNEL CHARGESa) Remuneration and direct social benefits 12,290 11,757b) Employers' contribution for social security 3,941 4,358c) Employers' premium for extra statutory insurance 513 308d) Other personnel charges 824 684e) Pensions 37 37

C3. PROVISIONS FOR PENSIONSIncrease, decrease 26 30

D. AMOUNTS WRITTEN OFF1) Stocks and contracts in progress

Recorded 141 155Write back (139) (120)

2) Trade debtorsRecorded 78 25Write back (17) (38)

E. PROVISIONS FOR LIABILITIES AND CHARGESIncreases 303 220Decreases (217) (453)

F. OTHER OPERATING CHARGESTaxes related to operations 339 290Other charges 72 54

G. TEMPORARY EMPLOYEES AND PERSONS PLACED AT THE DISPOSAL OF THE ENTERPRISE1) Total number at the closing date 11 132) Average number of employees in full-time equivalents 18.8 29.3

Number of actual working hours 37,072 51,158Charges to the enterprise 753 999

XIII. FINANCIAL RESULTS in thousands of EUR 2000 1999

A. OTHER FINANCIAL INCOMEAmount of subsidies granted by public authorities: credited to income for the year:

• Capital subsidies 6 6

XIV. EXTRAORDINARY RESULTS in thousands of EUR 2000

A. Analysis of OTHER EXTRAORDINARY INCOME, if material.Extraordinary income: dioxine 596

ıXV. INCOME TAXES in thousands of EUR 2000

A. ANALYSIS OF THE INCOME TAXES1. Income taxes of the current year: 766a) Taxes and withholding taxes due or paid 550b) Excess of income tax prepayments and withholding taxes capitalised -c) Estimated additional charges for income taxes 216

2. Income taxes on previous year 1a) Taxes and withholding taxes due or paid 1

B. IMPORTANT REASONS FOR DIFFERENCES BETWEEN THE PROFITBEFORE TAXES AS STATED IN THE ANNUAL ACCOUNTS AND THE ESTIMATED TAXABLE PROFIT

Director's emoluments 99

XVI. OTHER TAXES AND TAXES BORNE BY THIRD PARTIES in thousands of EUR 2000 1999

A. The total amount of value added tax charged during the year:1. to the enterprise (deductible) 8,911 9,1152. by the enterprise 6,006 6,899

B. Amounts retained on behalf of third parties for:1. payroll withholding taxes 3,002 2,9492. withholding taxes on investment income 91 86

XVII. RIGHTS AND COMMITMENTS NOT ACCRUED IN THE BALANCE SHEET in thousands of EUR 2000

Amount of forward contracts:• Goods purchased (to be received) 3,290• Currencies sold (to be delivered) 12,537

6362

XVIII. RELATIONSHIPS WITH AFFILIATED ENTERPRISES in thousands of EUR

2000 19991. FINANCIAL FIXED ASSETS 34,792 25,327Investments 31,980 22,796Other amounts receivable 2,812 2,531

2. AMOUNTS RECEIVABLE 6,402 5,035Within one year 6,402 5,035

4. AMOUNTS PAYABLE 3,804 4,083After one year 240 1,052Within one year 3,564 3,031

7. FINANCIAL RESULTSFrom financial fixed assets 1,021 2,138From interest and debts 23 31

8. DISPOSAL OF FIXED ASSETSRealised capital gains - 8

XIX. FINANCIAL RELATIONS WITH DIRECTORS in thousands of EUR 2000

4. The amount of direct and indirect remuneration and pensions, included in the income statement, as long as this disclosure does not concern, exclusively or mainly, the situation of one single identifiable person:

To directors and managers 153

6564

Social Report

I. STATEMENT OF THE PERSONS EMPLOYED

A. EMPLOYEES RECORDED IN THE PERSONNEL REGISTER1. During the financial period or the previous financial period Full-time Part-time Total (T) Total (T)

or total of or total offull-time full-time

equivalents equivalents(FTE) (FTE)

2000 2000 2000 1999

Average number of employees 386.3 136.8 477.2 FTE 469 FTENumber of actual working hours 602,381 123,095 725,476 T 710,204 TPersonnel charges in thousands of EUR 15,082 2,523 17,605 T 17,144 T

2. As at the closing date of the financial period Full-time Part-time Totalin full-time

equivalents

a) Number of employees recorded in the personnel register 390 159 482.1b) By nature of the employment contract

Contract of unlimited duration 349 155 438.5Contract of limited duration 37 3 39.0Contract regarding substitution 4 1 4.6

c) By sexMale 221 8 226.8Female 169 151 255.3

d) By professional categoryManagement personnel 20 2 21.4Employees 110 35 134.5Workers 260 122 326.2

B. TEMPORARY PERSONNEL AND PERSONS PLACED AT THE DISPOSAL OF THE ENTERPRISE TemporaryDuring the financial period personnelAverage number of personnel employed 18.8Number of actual working hours 37,072Charges to the enterprise in thousands of EUR 753

II. LIST OF PERSONNEL MOVEMENTS DURING THE FINANCIAL PERIOD

A. ENTRANTS Full-time Part-timea) Number of employed persons recorded in the personnel

register during the financial period 111 11 118.3b) By nature of the employment contract

Contract of unlimited duration 34 8 39.3Contract of limited duration 73 3 75.0Contract regarding substitution 4 - 4.0

c) By sex and level of educationMale: primary education 4 - 4.0

secondary education 44 1 44.8higher non-university education 1 - 1.0university education 3 - 3.0

Female: primary education 2 3 3.7secondary education 50 3 51.8higher non-university education 5 3 7.3university education 2 1 2.7

B. LEAVERSFull-time Part-time Total of

full-timeequivalents

a) Number of employed persons of which the dateof termination of the contracts has been recorded in the personnel register during the financial period 96 5 99.2

b) By nature of the employment contractContract of unlimited duration 32 2 33.2Contract of limited duration 62 3 64.0Contract regarding substitution 2 - 2.0

c) By sex and level of educationMale: primary education 5 - 5.0

secondary education 47 - 47.0higher non-university education 1 - 1.0university education 5 - 5.0

Female: primary education 2 - 2.0secondary education 35 3 36.8higher non-university education 1 1 1.7university education - 1 0.7

d) By reason of termination of contractPension 2 - 2.0Prepension 1 - 1.0Dismissal 5 1 5.4Other reason 88 4 90.8

III. STATEMENT CONCERNING THE IMPLEMENTATION OF MEASURES STIMULATING EMPLOYMENT DURING THE FINANCIAL PERIOD

MEASURES STIMULATING EMPLOYMENTNumber of employed persons involved

Number In full-time Financial profit equivalents in thousands of EUR

1. MEASURES GENERATING FINANCIAL PROFIT1.9. Full career interruption 1 1.0 1

2. OTHER MEASURES2.1. Contract of first professional experience 3 3.02.3. Training period for junior employees 15 15.02.7. Conventional prepension 3 3.0Number of employees involved within one or more measures stimulating employment:

• Total for the financial period 22 22.0• Total for the previous financial period 324 297.4

IV. INFORMATION ON VOCATIONAL TRAINING FOR EMPLOYED PERSONS DURING THE FINANCIAL PERIOD

Number of Number of Charges to employees training hours the enterprise

involved attended in thousands of EUR

Total of training initiatives at the expense of the employerMale 143 6,270 251Female 163 5,267 211

66

Comments on the annualaccounts of Lotus Bakeries NV

1. Assets

Significant investments in productionmaterials and in a new integrated infor-mation system meant that the tangiblefixed assets rose by 1.13 million EUR.

The increase in the financial fixedassets lies primarily in the participations.The most important of these is the parti-cipation of 50% in Interwaffles and theincreases in capital in Cremers-Ribertand Lotus-Delta.

The current assets fell slightly by 0.49million EUR, principally as a result of thefall in the other receivables. Last year thiscategory included the claim on the insu-rance company for damages arisingfrom the dioxin crisis.

In the context of the option plans as ofthe end of 2000, own shares LotusBakeries had already been purchased foran amount of 0.84 million EUR.

The cash at bank and in hand fell by1.17 million EUR. This is rather likely tobe the result of a one-off observation.

2. Liabilities

The purchase of own shares of LotusBakeries within the scope of the afore-mentioned option plan was bookedunder the non-available reserves.

The amounts payable after more thanone year grew by 13.95 million EUR.This increase is explained by the purcha-se of the 50% participation inInterwaffles. the increases in capital inCremers-Ribert and Lotus-Delta, and bythe conversion of financial debts in theshort term to long-term financial debts.

The amounts payable within one yearfell as a result by 7.42 million. For thesedebts the interest risk is covered withsuitable financial instruments.

The trade debts fell by 3.8 million EUR.In 2000 reimbursement was made of theMaribel support for the period ’93-’97that was due for repayment. Thisexplains the fall in debts relating toremuneration and social security.

3. Income statement

Turnover grew by 12.3% due to thetakeover of the sales of the Suzy brandproducts and because of significantinternal growth. The 1999 turnover hadbeen negatively affected by the dioxincrisis.

Raw materials, consumables andgoods for resale rose by 6.68 millionEUR. The most important reason for thisis the increased purchases of goods forresale principally within the context of thesales for Harry’s Benelux.

The increase in services and othergoods by 2.84 million EUR can to aconsiderable extent be attributed to significantly higher cost for market- andbrand support.

Personnel costs only rose slightlythanks to better productivity on the production side.

Depreciations rose by 0.46 million EURas a consequence of the significantinvestments of the last couple of years.

Operating profit rose considerably by36.26% compared to 1999.

The financial income principally relatedto dividend payments by subsidiarycompanies. Due to the higher amountspayable and the higher interest rates thefinancial costs rose by 0.7 million EUR.

Exceptional charges for 1999 mainlyconcerned the costs related to the dioxincrisis.

Due to the significant increase in theoperating profit and after taking intoaccount the higher financial charges, theprofit before tax rose by 0.41 million EURor 17.92%.

Due to higher taxes the net result fellslightly by 0.11 million EUR.

67

Valuation rules

1. Assets

1.1. Formation Expenses

Formation expenses were booked atpurchase price and depreciated at100%.

1.2. Intangible fixed assets

The intangible fixed assets were enteredat purchase or transfer price.The amortisation percentages appliedwere as follows:• research and development 33%• licensing 33%• clientele 10%• advances 0%

The depreciation of the clientele over ten years is justified by the stable clientrelationships that have been realizedthrough the brands Lotus, Corona,Cremers and Suzy.

1.3. Tangible fixed assets

Tangible fixed assets, mentioned underheading III, were included at purchaseprice. Additional costs, included inassets under heading III were bookedseparately.

Beginning in 1993 assets under con-struction and advance payments weredepreciated according to their definitedestination, except if it is concerningabout fixed assets which are deprecia-ted over maximum three years. Theselast mentioned assets are depreciatedas from the year of coming into opera-tion.

Investments in office equipment weredepreciated over three years, beginning1994, instead of over five years.

Beginning in 1980 the degressivemethod was used wherever possible,applying the following depreciation rates:

• Buildings 5%• Installations and equipment 10%• Machines, tools and furniture 20%• Office equipment 33%• Equipment subject to rapid wear

and tear 33%• Software 33%• Vehicles 20%• Additional costs 100%• Advances on tangible fixed assets:

according to their definite destination• Produced fixed assets: according to

their definite destination.

1.4. Financial fixed assets

Financial fixed assets are valued atacquisition price or contribution valuewithout supplementary costs.

Depreciation is applied where the esti-mated value of the financial fixed assetsis less than the accounting value andwhere the loss of value so determined isof a lasting nature in the opinion of theBoard of Directors.

The estimated value of the financial fixedassets is determined at the end of theaccounting period based on the mostrecent available balance sheet and onone or more criteria.

Depreciations are taken back to the sumof the previously recorded depreciationswhere the valuation at the closing dateof the accounting period concerned sig-nificantly exceeds the previous valuation.

1.5. Stocks

Finished products were valued at standard production cost price.

Raw materials, consumables and goodsfor resale were booked at the cost ofacquistion using the FIFO method.

For stocks, real depreciation was appliedin the event that they had become use-less or if their practical value or realisa-tion value was lower than the cost price.

1.6. Receivables

The necessary depreciation has beenapplied for receivables the collection ofwhich is in doubt. Receivables werebooked at their nominal value, less anycredit notes remaining to be drawn up.

Receivables in foreign currencies wereconverted at the exchange rate applyingon the balance sheet date.

Negative exchange rate differences onthe not-Euro currencies were included inthe income statement as in the past.

2. Liabilities

2.1. Provisions for liabilities and charges

Provisions have been made for all normallyforeseeable liabilities and charges.

2.2. Amounts payable within one year

• Suppliers

Debts to suppliers have been booked attheir nominal value. Debts in foreign currencies have been valued at the rateof exchange on the balance date.Differences in the exchange rate havebeen booked as with “receivables”.

• Liabilities and provisions for taxes, remunerations and social security.

The anticipated debts with regard to single and double holiday allowances,redistribution of social security charges,personnel insurances and the Maribelreimbursement have been booked in full.

6968

Registered OfficeLotus Bakeries NVGentstraat 52B- 9971 Lembeke

Tel.: +32(0)9/376.26.11Fax: +32(0)9/376.26.26Internet: http://www.lotusbakeries.com

Commercial registerGhent 11.294

VAT numberBE 401.030.860

Annual report

This annual report 2000 is also available on the internetsite:http://www.lotusbakeries.com

Dit jaarverslag is eveneens verkrijgbaar in het Nederlands.

Ce rapport annuel est également disponible en français.

Dieser Geschäftsbericht ist auch aufDeutsch erhältlich.

Contact

For further information about the data of the annual report or more informationabout the Group Lotus Bakeries, pleasecontact:

Filip StandaertSecretary-GeneralGentstraat 529971 LembekeTel.: +32(0)9/376.26.11Fax: +32(0)9/376.26.04E-mail: filip.standaert@lotusbakeries.com

Kolophon

Concept and realisation: Vandekerckhove & Devos

Photos: Benny De Grove (p.9.20.23.26)Luk Thys (p.15.19)Vandekerckhove & Devos(p.1.3.5.7.11.13.16.17.18.24.25.27.29.31.33.35.37.69)

Translation: Dekryptos SA

Print: Deckers Druk

Acknowledgement

We wish to thank all our cooperators.Their commitment in realizing the company’s targets and their dynamismenable us to reach the reported resultsand make us feel confident of the future.

Auditor’s report for the yearended december 31, 2000

To the shareholders’ meeting of LotusBakeries NV

In accordance with legal and statutoryrequirements we are pleased to report to you on the performance of the auditmandate which you have entrusted to us.

We have audited the financial statements for the year endedDecember 31, 2000 which have beenprepared under the responsibility of theboard of directors and which show abalance sheet total of 75,159 thousandsof EUR and a profit for the year of 1,930 thousands of EUR. We have alsocarried out the specific additional auditprocedures required by law.

Unqualified audit opinion on thefinancial statements

Our examination has been conducted in accordance with the auditing stan-dards of the “Institut des Reviseursd'Entreprises/Instituut derBedrijfsrevisoren”. Those standardsrequire that we plan and perform theaudit to obtain reasonable assuranceabout whether the financial statementsare free of material misstatement, takinginto account the Belgian legal and regulatory requirements applicable to financial statements.

In accordance with those standards, weconsidered the company’s administrativeand accounting organisation, as well asits internal control procedures. Companyofficials have responded clearly to ourrequests for information and explana-tions. We have examined on a testbasis, the evidence supporting theamounts and disclosures in the financialstatements. We have assessed theaccounting policies, the significantaccounting estimates made by the company and the overall presentation of the financial statements. We believethat our audit provides a reasonablebasis for our opinion.

In our opinion, taking into account theapplicable legal and regulatory require-ments, the financial statements give a true and fair view of the company’sassets, liabilities, financial position as ofDecember 31, 2000 and the results ofits operations for the year then endedand the information given in the notes to the financial statements is adequate.

Additional certifications and informations

We supplement our report with the following certifications and informationswhich do not modify our audit opinionon the financial statements:

- The directors’ report includes the information required by law and is con-sistent with the financial statements.

- The accounting records are maintainedand the financial statements have beenprepared in accordance with the legaland regulatory requirements applicable inBelgium.

- No transactions have been undertakenor decisions taken in violation of thecompany’s statutes or Company Lawwhich we would have to report to you.The appropriation of results proposed tothe General Meeting complies with thelegal and statutory provisions.

Ghent, April 13, 2001Ernst & Young Reviseurs d'EntreprisesS.C.C. (B 160)

Auditorrepresented byERIK DE LEMBRE,Partner

IX. GENERAL INFORMATION

7170

Notes Notes

72

Notes