BIOPETROL INDUSTRIES AG
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BIOPETROL increases profits in first half of year

NB: Please note the disclaimer at the end of this press release

Dusseldorf, 21 August 2007 In the first six months of the financial year 2007, BIOPETROL INDUSTRIES AG increased consolidated sales revenues by about 48% to €92.4 million (previous year: €62.3 million). Gross profit improved by more than 50% to €12.5 million (previous year: €8.3 million). The gross profit margin remained almost unchanged in this period at 12.7% (previous year: 13.3%). Earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by almost 70% to €4.4 million (previous year: €2.6 million). The EBITDA margin increased to 4.7% (previous year: 4.1%). Consolidated income surplus climbed by almost 78% to €2.7 million (previous year: €1.5 million). These results were influenced by the first economies of scale arising from increase in capacity and the efficient cost structure of the BIOPETROL Group. Despite high pre-production costs for the third plant being constructed in Rotterdam, earnings before interest and taxes (EBIT) increased by almost 57% to €3.1 million (previous year: €2.0 million). As expected, the operative cash flow was noticeably negative at €-12.2 million (previous year: €5.0 million). This was due to the increase in current assets due to strong growth, but the increase in trade accounts receivable and the increase in inventories had a negative effect.

Sales revenues increase due to increased capacity
The increase in sales revenues in the first half of 2007 has been due mainly to production starting up at the Rostock biodiesel plant. In conjunction with the Schwarzheide plant, BIOPETROL now has an annual capacity of 350,000 tonnes. The production plant under construction in Rotterdam should extend this by 2008 to 750,000 tonnes per year. In the first half of the year, a total of 116,729 tonnes (previous year: 73,410 tonnes) of biodiesel was produced. This represents an increase of 59% over the same period in the previous year. Construction of the Rotterdam plant is proceeding on target. Pre-production costs here are not yet offset against income and this will burden the profit situation throughout the 2007 financial year.

Significant second quarter growth in sales revenues and profits
In the second quarter of the current financial year, sales revenues of the BIOPETROL Group grew by 62% to €50.1 million (previous year: €30.9 million), more than one-third of which was earned overseas. Biodiesel sales rose in this period by almost 80% to 64,810 tonnes. The Q2 EBITDA more than tripled, increasing to €2.3 million (previous year: €0.7 million). The EBITDA margin improved in quarterly comparison to 4.7% (previous year: 2.3%). Despite interim output for the new plant in Rotterdam, EBIT rose in this period to €2.7 million (previous year: €0.4 million). Personnel expenses were a significant factor, increasing in Q2 by over 50% to €1.3 million (previous year: €0.9 million).

Financing for growth secured
In February 2007, BIOPETROL INDUSTRIES AG secured financing for planned investment with placement of a convertible bond with a volume of €75 million. This increased the equity ratio at 30 June to 44.9%, reduced from 78.8% at balance sheet date 31 December 2006. The balance sheet total increased to €164.8 million, after € 87.4 million at the end of 2006.

Political situation in Germany remains difficult
After introduction of the energy tax on biodiesel in Germany in August 2006, the situation for biodiesel producers remains tense. In the coming year, the tax rate in the free market (B100) is to be increased incrementally from the €0.09 per litre to €0.15 per litre. Subsidised biodiesel imports from the USA (B99) are causing extra pressure, particularly in the German fuel market. However, there are assurances that the US government will in future restrict these subsidies to the domestic US market.

Biofuel industry associations in Germany expect an amendment to energy tax laws after the political summer break. The anticipated amendment is expected to be modelled on the German federal government’s roadmap for biofuels, which envisages a biofuel market share on 17% by 2020. It is possible that in a first step B7 could be introduced in 2008.

Outlook:
BIOPETROL INDUSTRIES AG remains fixed on growth and with an annual capacity of 750,000 tonnes from 2008 will be one of Europe’s largest biodiesel producers. The new plant in Rotterdam will continue the internationalisation of the company. The target is to achieve 60% of sales revenue from outside Germany in the coming year. High pre-production costs for capacity extension will continue to burden the results of the BIOPETROL Group throughout 2007.

The comprehensive quarterly report (Q2 as at 30 June 2007) is published in German and English on the company’s homepage at www.biopetrol-ind.com.

About the company:
BIOPETROL INDUSTRIES AG, based in Zug, Switzerland, produces and distributes via its German and Swiss subsidiaries biodiesel and pharmaceutical grade glycerine of the highest quality. Its customers include the mineral oil industry and oil traders, large fleet operators, public transport, agriculture and the construction industry. In addition, glycerine is supplied to the pharmaceuticals and cosmetics industries.

At present BIOPETROL Industries AG produces about 350,000 tonnes of biodiesel and 30,000 tonnes of pharmaceutical grade glycerine per year in Schwarzheide and Rostock. In Rotterdam in the Netherlands, BIOPETROL is building a plant with an annual production capacity of 400,000 tonnes of biodiesel and 60,000 tonnes of pharmaceutical grade glycerine per year. By the end of 2008, annual capacity is to be more than doubled to 750,000 tonnes of biodiesel. A further enlargement of capacity in Rotterdam is under consideration in addition to securing growth by means of purchases and expansion of the product range based on the by-product glycerine.

Disclaimer
This press release is neither an offer to sell nor an invitation to submit an offer to buy or subscribe to securities. This release and the information that it contains are not intended for direct or indirect circulation to or within the United States of America, Canada, Australia or Japan.

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