A2 Milk Company Limited · NZX:ATM
A2 Milk — A2 — FY2012 Earnings Presentation
17 slides from A2 Milk's earnings presentation, Sep 4, 2012
Slide 1: A2 Corporation Presentation
A2 Corporation Presentation 4 September 2012 Geoffrey Babidge, CEO
Slide 2: Presentation Agenda
Presentation Agenda * Overview ¢ 2012 Financials ¢ Key Results ¢ The A2C Growth Strategy ¢ Australian Business Summary * A2 Milk (UK) Joint Venture Summary ¢ Further International Initiatives
Slide 3: Overview
Overview a2) During 2012, A2C progressed the company’s strategic agenda from 2010 * Australia: Continued strong growth in sales and profitability in Australia; Commissioned green-field fresh milk processing facility in Sydney ¢ International: Established fresh milk JV business in the UK and Ireland;
Slide 4: 2012 Financial Summary
2012 Financial Summary $'000 2012 Trading Revenue $62,458 Gross Margin — excl dep'n S21 297: EBITDA $4,737 NPAT $4,405 Equity $37,348. = EPS 0.74 Current Ratio 2.03 ROE 11.8% , Shares on Issue at August 31 , 2012 — 604,666,979 2011 $42,206 $15,271 $2,683 $2,116 $25,183 0.40 2.66 8.4% Variance 48% 40
Slide 5: Key Results
Key Results a2) + Group Profit after Tax for 2012 of $4,405,000, compared to $2,116,000 in prior year + EBITDA before share of associate earnings and non recurring items of $4,737,000. The Australian business contributed operational profit well ahead of plan and 2011 « Share of associate earnings (A
Slide 6: Current Geographical and Product Overview
Current Geographical and Product Overview hical Overview wv Australia: Sourcing, processing, marketing and sale of fresh milk andlicensing of yoghurt NZ: Brandlicense to Fresha Valley for fresh milk and infant nutrition manufacturing, agreement with Synlait Milk UK & Ireland: Sales and marketing JV
Slide 7: The A2C Strategic Growth Agenda
The A2C Strategic Growth Agenda a2) * A2C is focused on three core growth initiatives: #1 #2 Developing an Infant Formula business in Capturing niche shares in global milk and other dairy product markets Building the beverage business in Australia highly prospective and New Zealand markets + The str
Slide 8: The Australian Business Performed Strongly
The Australian Business Performed Strongly a2) ° a2 Milk™ sales increased 48% on the prior year * — Significant growth in 2012 Operational Profit compared to last year + Increase in marketing and communication including successful “Thank-you A2” campaign, public relations and HCP activity + Further
Slide 9: a2 brand sales performance in Australia
a2™ brand sales performance in Australia a2) 15,387 8,466 8,373 8512 7,641 4,216 4,200 4,122 Qtr to 3.9.10 Qtr To 20/0907 Qu To 31/0308 ‘Qtr To 3000808 Qtr To 3103100 ‘Qtr To 0108/00 er to 31/310 Qu 10313.11 Otrt0 20.11 Qtr to 30.3.12 ™ Gross Sales A$ (000's) y Gross Sales Fresh Milk A2DPA (A$ 000’
Slide 10: a2 brand milk: fastest growing and largest in the premium market
a2™ brand milk: fastest growing and a2) largest in the premium market % Share of Fresh Milk in Australian Grocery (Latest Quarter — by value) ‘%Market Sh: ee sJul-2011 mJul-2012 %Growth 46.3% 6.0 6.0 5.0 44 40 15.0% 5.6% (se) 0.0% 25.0% os 05 oa 08 Organic Plant Sterol Goatmilk Fresh Soy
Slide 11: A2 Sydney processing facility
A2 Sydney processing facility: : commissioned February 2012, officially a2) opened August 2012 Smeaton Grange facility opened 28'> August 2012 by NSW Premier, The Hon. Barry O'Farrell MP Wl BA AM y/ ie sh 0 af iia. “ie f Pah af 2
Slide 12: A2C to enter the UK market with the largest milk processor
A2C to enter the UK market with the largest milk processor : A2C established a Sales and Marketing JV for fresh milk, UHT and cream with Robert Wiseman Dairies in November 2011 ° Management team, herd testing, marketing plans are in place + Launch of a2™ brand milk now planned for last quarter 2012
Slide 13: A2 UK marketing and communication plans
A2 UK marketing and communication LPN, plans: tailored for the UK market SS —— Coming soon + Brand position largely similar to that oily originally in Australia, tailored as appropriate for the UK market : + Key positioning “The Natural Answer” : supported by research * Clear communication of the a2
Slide 14: Communication: Two-Pronged Strategy
Communication: 2 Pronged Strategy * Building awareness and advocacy + Engaging The UK Consumer among UK Healthcare Professionals (TV, Press, Outdoor, Online, Social Media, PR) (Press, Events, Online, Social Media, PR) SS Milk intolerance under @ en ee the microscope “My whole family are getting on w
Slide 15: Further growth initiatives are underway
Further growth initiatives are underway a2) + A2C has progressed discussions with a number of parties in markets considered attractive for a2 Milk™ beverages + The Company has undertaken significant planning around the introduction of infant formula into China, and considers this represents a stando
Slide 16: A2C infant formula focused on the China market opportunity
A2C infant formula focused on the a2) China market opportunity The China infant formula market is very large (c. US$6bn), growing quickly (c. 12% p.a.) and is regarded as undersupplied The key driver of infant formula purchasing decisions in China is a strong focus on safety, quality, country of ori
Slide 17: Thank You
@ Thank You a2 Pl cn