Financial results in 2017 (unaudited) Results in line with - PowerPoint PPT Presentation

Financial results in 2017 (unaudited) Results in line with expectations coupled with strong profitability growth Zagreb, 28th February 2018

TABLE OF CONTENTS KEY DEVELOPMENTS IN 2017 PERFORMANCE ON CAPITAL MARKET IN 2017 FINANCIAL RESULTS IN 2017 GUIDANCE FOR 2018 APPENDIX 2

KEY BUSINESS DEVELOPMENTS IN 2017 Results in line with expectations coupled with strong profitability growth Development of own brands and openings of new specialised stores Limitations in cooperation with key customer Atlantic Grupa and Belgian Aminolabs entered into a strategic partnership New distribution contracts and the start of Argeta production in the United States of America Reorganisation of Atlantic G rupa’s distribution activities Significant decrease of indebtness and cash flow growth Risk management and consolidation of IT solutions 3

ACHIEVEMENTS OF ATLANTIC GRUPA’S OWN BRANDS (I) Double-digit sales growth in Croatia, Almost a 40% Double-digit growth Serbia, Montenegro, 7% growth in growth in Croatia in Croatia Macedonia, almost a Croatia 20% growth in Switzerland Cedevita HoReCa Double-digit growth recorded a near Over 20 million B&E 30% higher sale of in Russia, Croatia 20% and nearly sachetes sold Multivita in Russia double-digit growth and Serbia of Cedevita Fresh Double-digit revenue Double-digit revenue increase of Barcaffe increase espresso

ACHIEVEMENTS OF ATLANTIC GRUPA’S OWN BRANDS (II) 5

ACHIEVEMENTS OF ATLANTIC GRUPA’S OWN BRANDS ( III) 6

KEY BUSINESS DEVELOPMENTS: PRINCIPAL BRANDS DISTRIBUTION  New distribution contracts  Reorganisation of distribution activities  Double-digit sales growth of the SDR HoReCa 7

KEY BUSINESS DEVELOPMENTS: OWN BRANDS SBU BEVERAGES SBU COFFEE  Record market share in Croatia (17.4%),  Donat Mg HoReCa edition stable market shares in Slovenia (71.2%) and Serbia (54.2%)  Innovation Chia Fresca by Cedevita  Launched Barcaffe D.O.T. capsules  Grand Aroma redesign  Cockta Black Tonic redesign 8

KEY BUSINESS DEVELOPMENTS: OWN BRANDS SBU PHARMA AND SBU SAVOURY SPREADS SBU SNACKS PERSONAL CARE  Vegetable spreads launched  95 years of chocolate  Production started in the  Launched a new line of production and 45 years of USA Smoki brand Melem essential oils and  New flavours of Argeta  Numerous new and Melem shower gels  Rosal new Personal Care  Leading Savoury Spread in promotional products  Chipsos redesign line Switzerland and Austria  4 new specialised stores opened 9

KEY BUSINESS DEVELOPMENTS: OWN BRANDS BU BABY BU GOURMET SBU SPORTS AND FUNCTIONAL FOOD  Launched a new  New line of products:  Launched 100% Whey segment – cereals for Fruit&Honey  New, simplified package (protein powder) moms  New protein bars: design Protein Layer 10

AMINOLABS PARTNERSHIP  Factories in Bleckede and Nova Gradiška sold, as well as the associated private label production for third parties (revenues in 2017 in the amount of HRK 194,3 million) Cash received and receivables from sale of subsidiaries  Transaction ealised on 31st (in thousands of HRK) October 2017 Cash 150.0 Receivables 59.6  Strategic brands will remain in Total sales consideration 209.6 full ownership of Atlantic Grupa Gain from sale of subsidiaries 64.8 11

TABLE OF CONTENTS KEY DEVELOPMENTS IN 2017 PERFORMANCE ON CAPITAL MARKET IN 2017 FINANCIAL RESULTS IN 2017 GUIDANCE FOR 2018 APPENDIX 12

PREFORMANCE ON CROATIAN CAPITAL MARKET Performance on the capital market ATGR Crobex Crobex10  Share price fall of 2,3% 50% 34.0% 30.9%  Stable shareholder 18.1% 17.1% 7.8% structure 3.1% 10% 2.4% 1.2% (1.8%)  Free float of 44.0% (2.3%) (2.7%) (7.0%) (3.2%) (7.6%) (11.4%) -30% 2017 2016 2015 2014 2013 31 st December 31 st December Ownership structure as of 31 December 2017 Valuation 2017 2016 EBRD 2.0% Management Last price in reporting period 862.0 882.0 1.2% Market capitalization* (in HRK millions) 2,874.2 2,940.9 Other Lada Tedeschi Fiorio Erste Plavi OPF - 10.4% 5.8% category B Average daily turnover (in HRK 6.1% 356.2 717.9 AZ OPF - category B thousands) 8.6% EV (in HRK millions) 4,063.2 4,446.1 PBZ CO OPF - category B Pension funds … 2.9% 7.9 9.4 EV/EBITDA Raiffeisen VPF Raiffeisen OPF - Emil Tedeschi EV/EBIT 11.9 14.4 1.5% category B … 50.2% Other pension funds EV/sales 0.8 0.9 1.6% EPS (in HRK) 63.2 48.8 P/E 13.6 18.1 13 *Closing price multiplied by the total number of shares

TABLE OF CONTENTS KEY DEVELOPMENTS IN 2017 PERFORMANCE ON CAPITAL MARKET IN 2017 FINANCIAL RESULTS IN 2017 GUIDANCE FOR 2018 APPENDIX 14

RESULTS IN LINE WITH EXPECTATIONS 2017A/2017E: 100.1 2017A/2017E: 99.5 2017A/2017E: 99.0 2017A/2016A: 103.9 2017A/2016A: 109.1 2017A/2016A: 111.0 2017A 2017A 700 2017E 2017E 5,307 5,300 517 520 2016A 2016A 600 474 5,400 5,106 500 342 345 5,200 400 308 5,000 300 4,800 200 4,600 100 4,400 0 Sales EBITDA EBIT Normalised data *Expectations changed in December of 2017 15

SALES BY STRATEGIC BUSINESS UNITS AND STATEGIC DISTRIBUTION UNITS FY 2017/ (HRK million) FY 2017 FY 2016 FY 2016  SBU Coffee: records a considerable increase in sales, due to good sales SBU Coffee 1,098.4 1,064.7 3.2% results in all the key markets and all key categories coupled with high value market share SBU (Sweet and Salted) Snacks 678.4 651.3 4.2%  SBU Snacks: great sales results in the markets of Serbia, Bosnia and Herzegovina and Montenegro, and a double-digit growth in the market of SBU Beverages 677.0 630.8 7.3% Croatia.  SBU Beverages: a significant increase in sales in almost all categories, SBU Pharma and Personal Care 583.6 545.2 7.0% due to excellent sales results in Croatia, Slovenia, Russia and Bosnia and Herzegovina. SBU Savoury Spreads 581.0 543.0 7.0%  SBU Pharma and Personal Care: an excellent increase in sales primarily SBU Sports and Functional Food 384.6 449.3 (14.4%) due to the increase in sales of the pharmacy chain Farmacia and the increase in sales of Multivita (Vitamin C in Russia), Neva i Dietpharm *From which private label production 194.3 177.2 9.7% products. SDU Serbia 1,134.6 1,101.1 3.0%  SBU Savoury Spreads: a significant sales growth due to double-digit revenue growth in the majority of markets. SDU Croatia 1,035.9 968.8 6.9%  SBU Sports and Functional Food: an observable decrease in sales as a consequence of the portfolio restructuring. DU Slovenia 767.8 754.4 1.8%  Strategic Distribution Regions and Distribution units: excellent sales results of own brands and pricipal brands, coupled with record-high sales SDR Zone West 419.4 503.1 (16.6%) in Croatia, Slovenia and Macedonia.  SDR Zone West: a decrease in sales mainly in the German market in the Other segments* 862.8 763.0 13.1% SBU Sports and Functional Food. Reconciliation** (2,916.7) (2,868.5) n/a Sales 5,306.8 5,106.3 3.9% Comparative period has been adjusted to reflect current period reporting. * Other segments include SDR HoReCa, SDU CIS&Baltic, BU Baby Food, BU Gourmet, DU Macedonia and business activities not allocated to business and distribution units (headquarters and support functions in Serbia, Slovenia and Macedonia) which are excluded from the reportable operating segments. 16 ** Line item “Reconciliation” relates to the sale of own brands which is included in the appropriate SBU and BU and in SDUs, SDRs and DUs through which the products were distributed.

SALES BY MARKETS AND SEGMENTS 2017 2016 2% Croatia 28.8% Croatia 29.8% 3% 4% Serbia 23.2% Serbia 23.1% 3% 9% 10% 30% Slovenia 16.7% Slovenia 16.8% 29% 7% Bosnia and Herzegovina 7.8% 7% Bosnia and Herzegovina 7.8% 8% Other regional markets* 6.5% Other regional markets* 6.7% 8% Key European markets** 9.5% Key European markets** 10.1% 17% Russia and CIS 4.3% Russia and CIS 3.6% 23% 17% 23% Other markets 2.3% Other markets 3.0% * Macedonia, Montenegro, Kosovo ** Germany, United Kingdom, Italy, Switzerland, Austria, Sweden, Spain 1% 4% 3% 2% Principal brands 21.4% 4% Principal brands 21.6% Coffee 20.8% 1% Coffee 20.7% 5% 3% 21% 21% Sweet and salted snacks 12.8% 10% Beverages 12.8% 10% Beverages 12.4% Sweet and salted snacks 12.8% Savoury spreads 10.6% Savoury spreads 11.0% 11% 11% Pharma & Personal care 10.3% Pharma & Personal care 10.6% 21% 21% Sports and Functional Food - own brands 5.3% Sports and Functional Food - own brands 3.6% 13% 12% 13% 13% Sports and Function Food - private label production 3.5% Sports and Function Food - private label production 3.5% Baby food 2.7% Baby food 2.3% Gourmet 0.7% Gourmet 0.6% 17