He also noted that that the deal will be EBITDA margin dilutive in 2011, but that total EBITDA and free cash flow dollars will increase.

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Specialty coffees also have a higher EBITDA margin than the regular ones and hence the sale of higher proportion of these might help in improving the overall EBITDA margin for the company.

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While the EBITDA margins for Gillette have already declined over 2008-10 behind razors sold at highly discounted prices, we currently forecast EBITDA margins to rise gradually as consumers come back to buy blades.

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