Russian food and beverage group Wimm-Bill-Dann has seen its first quarter take a hit from what it called an "unprecedented" devaluation of the ruble.

The company released figures today showing that group revenues declined 29.4% year-on-year to US$516.8 million driven by the ruble devaluation and offset by a favourable pricing mix. Net income fell nearly 70% to $12.6m. On a constant currency basis (in rubles) adjusted net income grew 25.1%, the company pointed out.

EBITDA, for the quarter fell 19.4% to $73.1m. On a constant currency basis (in rubles) EBITDA increased 12.7%.

The Russian ruble devalued almost 45% year-on-year against US dollar in the first quarter

"The first quarter laid a solid foundation for the year, particularly in terms of substantial margin improvement and a balance sheet that is healthier than ever," said Tony Maher, Wimm-Bill-Dann's chief executive officer. "The company continues to perform very well in all business segments despite the challenges in the economic environment.

"We are working to maximize the return from our marketing and advertising investments, with a focus on gaining share in higher margin categories. As of the end of the first quarter, our market share in juices increased 170 basis points in volume terms compared to the end of the first quarter 2008. Our market share in baby food improved 240 basis points in volume terms over the same period, while our market share in yogurts and desserts increased 140 basis points in volume terms over the same period of time."

He added: "Looking ahead we understand that the current environment will continue to pose its challenges and we are working to manage the business through the near-term hurdles while improving our competitive position and our ability to execute on long-term opportunities. The soundness of our strategy and the strength of our balance sheet will help us navigate the issues of today and position the company optimally for sustainable growth as the economic environment improves."

The company said that sales in the dairy segment decreased 33.5% to $369.2m in the first quarter  This was driven by the negative exchange rate effect and partially offset by the improved sales mix. The average selling price declined 22.6% to $1.06 per 1 kg in the first quarter of 2009 from $1.36 per 1 kg in the first quarter of 2008. The gross margin in the dairy segment increased to 29.1% from 26.4% in the first quarter 2008, driven by lower raw milk costs and improved sales mix.

Sales in the beverage segment decreased 19.5% to $94.1m in the quarter. Again this was largely down to the exchange rate and partially offset by good volume growth. Average selling price decreased 27.8% to $0.74 per litre in the first quarter of 2009 from $1.02 per litre in the first quarter of 2008.