Frutarom Presents 6.7% Sales Growth and Record Results in Net Profit: US$ 13.1M

HAIFA, Israel, May 24, 2011 -

- Record Results Also Achieved in Q1 Gross Profit and EBITDA

    - Q1 Sales Reached US$ 121 m
    - Gross Profit Increased by 5% to US$ 45.7 m
    - Operating Profit - US$ 16.6 , Operating Margin 13.7%
    - EBITDA - US$ 21.5 m , EBITDA Margin 17.7%
    - Profit Before Tax Increased by 14.4% to US$ 17.5m
    - Earnings per Share Increased by 18.2% to a Q1 Record of US$ 0.23

Frutarom (LSE: FRUTq, TASE: FRUT, OTC: FRUTF) presented its 2011
first quarter results today.

Frutarom Industries Ltd., a top-ten company in the Flavors and
Specialty Fine Ingredients markets, continues to successfully implement its
rapid profitable growth strategy, which is expressed by internal growth and
by carrying out strategic acquisitions. The Company reports record results in
Q1 2011 in gross profit, operating profit, EBITDA, net profit, and earnings
per share compared to Q1 in previous years.

Frutarom reports 6.7% revenue growth over Q1 2011 reaching US$
121 M, as compared to sales of US$ 113.5 M in the same quarter last year,
that was characterized by strong growth as a result of the recovering global
economy and the resulting restocking trend. The growth in sales in Q1 2011
derived mainly from organic growth in Frutarom's core activities (Flavors and
Specialty Fine Ingredients) and from the contribution of the two successful
acquisitions that were completed during the quarter. The strengthening of
European currencies and the Israeli shekel against the US dollar also
contributed to the growth in sales. In local currency terms, a 4.6% growth in
Frutarom's sales was achieved in comparison to the same quarter last year.

Gross profit in Q1 2011 increased by 5% reaching a record US$
45.7 M compared to US$ 43.5 M in Q1 2010; Gross margin reached 37.7%. The
increase in gross profit was achieved despite the global increase in raw
material prices, affecting many of the raw materials used by Frutarom in the
manufacture of its products. Frutarom acts determinedly, and will continue to
do so as long as this trend persists, including by adjusting the selling
prices of its affected products in order to avoid future effect on its
results. Frutarom's management continues working diligently to maximize
efficiencies, examining and exploiting opportunities to maintain and reduce
expenses in order to further improve its competitive structure.

Operating profit in Q1 2011 totaled approximately US$ 16.6 M,
similar to the same quarter last year. Operating margin in Q1 2011 totaled
approximately 13.7%.

EBITDA in Q1 2011 increased and reached approximately US$ 21.5
M compared to US$ 21.3 M in the same quarter last year and the EBITDA margin
totaled 17.7%.

Profit before tax in Q1 2011 increased by 14.4% totaling US$
17.5 M (14.5% of sales) as compared to US$ 15.3 M (13.5% of sales) in the
same quarter last year.

Net profit in this period increased by 18.2% and reached a
quarterly record of US$ 13.1 M compared to US$ 11.1 M in the same quarter
last year. Net margin also increased and reached 10.8% compared to 9.8% in
the same period last year.

Earnings per share in Q1 2011 increased by 18.2% and reached a
Q1 record of US$ 0.23 per share as compared to US$ 0.19 per share in the same
quarter last year.

Frutarom's equity as at March 31, 2011 totaled US$ 380.1 M
(68% of the balance sheet) compared to US$ 316.6 M (61.9% of the balance
sheet) in the same quarter last year.

Ori Yehudai, Frutarom's President and CEO, commented: "We are
satisfied by the continued growth achieved in Q1 2011 and believe that it
will persist during 2011. The first quarter has seen record results in gross
profit, operating profit, EBITDA, net profit and in the earnings per share
compared to first quarter of previous years. This achievement is a result of
the implementation of our profitable growth strategy, combining continuous
internal sales growth in Frutarom's core activities alongside the execution
of strategic acquisitions while maintaining our competitive cost structure".

"In recent months, we have witnessed a global trend of raw
material price increase, including in many of the raw materials used by
Frutarom in the manufacture of its products. We have acted determinedly, and
shall continue to do so as long as this trend prevails, to prevent future
influences on the results of our activity including by adjusting the selling
prices of affected products. We are constantly acting to expand our sources
of supply and optimally use the diverse capabilities of Frutarom's production
sites worldwide."

"In Q1 2011, we completed the acquisitions of the Savory
activity of Norwegian company Rieber & Son and of the assets and activity of
UK company EAFI. These acquisitions are synergistic with our activity,
expanding our customer base and product portfolio and allowing us to better
provide comprehensive and high-quality solutions and meet the demands of our
diverse customers.

"Frutarom's solid capital structure, has been supported by the
strong cash flow achieved in the last two years, significantly contributing
to the reduction of debt; combined with the strong support of leading
financial institutions, it will allow us to continue implementing
persistently our rapid growth strategy, combining organic, profitable growth
and strategic acquisitions. We are acting to further realizing our excellent
acquisition pipeline, both in developed markets such as the US and Europe and
in emerging target markets in Asia, Central and South America, and Eastern
Europe. Alongside the acquisitions, we will continue to act for achieving
profitable, organic growth, to achieve our goal and again double our turnover
within the next 4 years."

About Frutarom

Frutarom is a global company operating in the flavor and fine
ingredients markets. Frutarom has significant production and development
centers on three continents and it markets its products in five continents to
over 13,000 customers in more than 120 countries. Frutarom's products are
intended for the food, beverage, flavor, fragrance, pharmaceutical,
nutraceutical, health food, functional food, food additives and cosmetic
industries.

Frutarom, which employs approximately 1,500 people worldwide,
has 2 main activities:

- The Flavors Segment, which develops, produces and markets
flavor compounds and food systems.

- The Fine Ingredients Segment, which develops, produces and
markets natural flavor extracts, natural functional food ingredients, natural
pharma/nutraceutical extracts, specialty essential oils, citrus products and
aroma chemicals.

Frutarom's products are produced in its plants in the US, UK,
Switzerland, Germany, Israel, China, South Africa and Turkey. The Company's
global marketing organization includes branches in Israel, the US, UK,
Switzerland, Germany, Belgium, the Netherlands, Denmark, France, Hungary,
Romania, Russia, Ukraine, Kazakhstan, Belarus, Turkey, Brazil, Mexico, Costa
Rica, China, Japan, Hong Kong, India, Indonesia and South Africa. The Company
also works through local agents and distributors worldwide.

(LSE: FRUT, TASE: FRUT, FRUTF.PK)

    For further information visit www.frutarom.com.

    Company Contact:
    Ori Yehudai, President & CEO
    Frutarom Ltd.
    Tel: +972-99603800
    Email: oyehudai@frutarom.com

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