CEDC announced net income on a U.S. GAAP basis (as hereinafter defined) for the year was $78.3 million or $1.45 per fully diluted share, as compared to net loss of $18.6 million or $0.42 per fully diluted share, for the same period in 2008. On a comparable basis, CEDC announced net income of $127.9 million, or $2.37 per fully diluted share, for the full year 2009, as compared to $128.0 million, or $2.86 per fully diluted share, for the same period in 2008. The number of fully diluted shares used in computing the full year earnings per share was 53.9 million for 2009 and 44.1 million for 2008. Operating profit on a comparable basis for the year 2009 was $222.9 million as compared to $206.9 million for 2008.

The net loss on a U.S. GAAP basis for the 4th quarter of 2009 was $94.9 million or $1.52 per fully diluted share, as compared to net loss of $82.3 million or $1.76 per fully diluted share, for the same period in 2008. On a comparable basis, CEDC announced net income of $72.5 million, or $1.15 per fully diluted share, for the 4th quarter 2009, as compared to $52.5 million, or $1.11 per fully diluted share, for the same period in 2008. Operating profit on a comparable basis for the 4th quarter of 2009 was $108.8 million as compared to $83.2 for 2008. For a complete reconciliation of comparable net income to net income reported under United States Generally Accepted Accounting Principles ("U.S. GAAP"), please see the section "Unaudited Reconciliation of Non-GAAP Measures".

The Company also announced it has updated its full year 2010 net sales guidance from $1.80-$2.00 billion to $1.80-$1.90 billion and its full year comparable fully-diluted earnings per share guidance from $3.00-$3.15 to $2.50-$2.62. The Company is also providing full year 2010 operating profit guidance of $315 to $330 million (an increase of approximately 44% over full year 2009 comparable operating profit) which includes approximately $18 million of depreciation and amortization for the year. This revised guidance includes exchange rates assumptions that have moved from 2.80-2.85 PLN/USD to 2.85-2.95 PLN/USD for the Polish Zloty and from 29.00-29.50 RUR/USD to 29.50-30.00 RUR/USD for the Russian Ruble, as well as an expected $0.40 to $0.45 annual dilutive impact on fully dilutive earnings per share from the recent debt and equity offerings that were completed in November and December 2009, which includes the estimated net interest expense of approximately $98-$102 million for the full year 2010. The number of fully diluted shares used in computing the full year 2010 guidance is approximately 70.1 million.

William Carey, President and CEO commented, "During the fourth quarter of 2009 we experienced a soft top line performance, driven mainly by weakness in the Polish distribution business as compared to the fourth quarter 2008, mainly due to the Polish excise increase that took place on January 1, 2009. The excise increase generated additional revenue of approximately $40 million in our Polish distribution business in the fourth quarter 2008 as compared to the fourth quarter 2009. We were however, able to see substantial improvements on our comparable gross and operating margins, benefiting from a positive sales mix between production and distribution, as well major costs reductions that took place during the year, both of which had a very positive impact on the fourth quarter operating results even while operating in a continued soft consumer environment."

William Carey, President and CEO continued, "We have spent the last twelve months strengthening our ownership position of some of our key assets which places the Company in a strong position to benefit from the consumer recovery which we anticipate to accelerate towards the second half of 2010. We strongly believe the dilutive impact of our fourth quarter 2009 refinancing is more than justified given our expectations as to the 3-5 year growth opportunity in our core markets, especially Russia. With the recent regulatory changes in Russia relating to, combating the grey market we anticipate stronger consumer demand in 2010 and renewed trends toward premiumization. Our strong market position in our core markets places us in a solid position to take advantage of what we anticipate will be a 3-5 year growth cycle of premiumization and strong demand for imported products. Having recently taken control of our largest investment and strongest cash flow generator for the Company, the Russian Alcohol Group, and obtaining 100% equity ownership of both of our vodka production businesses in Russia during the second half of 2009, we can now look forward to a clearer path to start to deliver on our 2010 objectives. The refinancing strengthened our balance sheet and significantly improved the maturity profile of our liabilities. These changes will allow management to direct its focus on executing the business objectives outlined below:

• Continued reduction of net leverage thru cash flow generation and potential asset disposals
• Integration of Parliament and the Russian Alcohol Group
• Improve gross margins by 300 to 400 basis points
• Improve operating margins by 200 to 300 basis points
• Increase profitable market share in our core markets of Russia, Poland and Hungary
• New product development, including,
• Russian brandy
• New vodka launch in Poland
• New mainstream vodka launch in Russia
• Sign new import agreements in our core markets of Russia, Poland and Hungary
• Expand export of our core brands in key international growth markets
• Strengthen focus on brands through a planned divestiture of the distribution business and other non-core assets"

CEDC has reported net income and fully diluted net income per share in accordance with GAAP and on a non-GAAP basis, referred to in this release as comparable non-GAAP net income. CEDC's management believes that the non-GAAP reporting giving effect to the adjustments shown in the attached reconciliation provides meaningful information and an alternative presentation useful to investors' understanding of CEDC's core operating results and trends. CEDC discusses results and guidance on a comparable basis in order to give investors better insight into underlying business trends from continuing operations. CEDC's calculation of these measures may not be the same as similarly named measures presented by other companies. These measures are not presented as an alternative to net income computed in accordance with GAAP as a performance measure, and you should not place undue reliance on such measures. A reconciliation of GAAP to non-GAAP measures can be found in the section "Unaudited Reconciliation of Non-GAAP Measures" at the end of this press release.

CEDC is the largest producer of vodka in the world and Central and Eastern Europe's largest integrated spirit beverage business. CEDC produces the Green Mark, Absolwent, Zubrowka, Bols, Parliament, Zhuravli, Royal and Soplica brands, among others. CEDC currently exports its products to many markets around the world, including the United States, England, France and Japan.

CEDC also is the leading national distributor of alcoholic beverages in Poland by value, and a leading importer of alcoholic beverages in Poland, Russia and Hungary. In Poland, CEDC imports many of the world's leading brands, including brands such as Carlo Rossi Wines, Concha y Toro wines, Metaxa Liqueur, Remy Martin Cognac, Guinness, Sutter Home wines, Grant's Whisky, Jagermeister, E&J Gallo, Jim Beam Bourbon, Sierra Tequila, Teacher's Whisky, Campari, Cinzano, Skyy Vodka and Old Smuggler. CEDC is also a leading importer of premium spirits and wines in Russia with such brands as Hennessey, Moet & Chandon and Concha y Toro, among others.

This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, without limitation, statements regarding expected sales and earnings guidance, expected gross margins and operating margins, reduced leverage, expectations of increased consumer demand for our products and premiumizations, cost reduction and working capital initiatives and expected results of, and synergies relating to, our Russian businesses. Forward looking statements are based on our knowledge of facts as of the date hereof and involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of CEDC to be materially different from any future results, performance or achievements expressed or implied by our forward looking statements.

Investors are cautioned that forward looking statements are not guarantees of future performance and that undue reliance should not be placed on such statements. CEDC undertakes no obligation to publicly update or revise any forward looking statements or to make any other forward looking statements, whether as a result of new information, future events or otherwise, unless required to do so by securities laws. Investors are referred to the full discussion of risks and uncertainties included in CEDC's Form 10-K for the fiscal year ended December 31, 2009, including statements made under the captions "Item 1A. Risks Relating to Our Business" and in other documents filed by CEDC with the Securities and Exchange Commission.
 

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