Full Year Result to 31 March 2016 Trilogy International Overview - PowerPoint PPT Presentation

Full Year Result to 31 March 2016

Trilogy International Overview TIL - Trilogy International Limited (NZX:TIL) is a cultivator of essential natural products and home fragrance brands: Trilogy, ECOYA and Goodness in New Zealand and around the world. It’s subsidiary CS&Co distributes international cosmetics, fragrances, skincare and haircare brands in New Zealand. Consumer Product Brands Distribution 2

TIL Segment Overview Natural Products Home Fragrance & Bodycare Distribution Brands Trilogy Goodness ECOYA CS&Co Certified natural and Certified organic chia seed oil Soy based home fragrance (candles, Third party premium beauty Products organic rosehip oil based skincare range diffusers, bodycare) products distribution skincare range Affordable luxury / premium Mass market / cost conscious House proud, fashion conscious New Zealand retailers Target Market self-select consumers – developed specifically consumer for the grocery channel +3500 stores +1600 stores +400 stores +1900 stores • • • • Pharmacies / health Grocery Department stores Pharmacies • • • Channels stores Farmers Independent gift and homeware Department stores • • • Department stores Priceline stores Grocery • • • Online Chemist Warehouse Salon • • • • New Zealand & Australia New Zealand & Australia New Zealand & Australia New Zealand Geographies • UK • Asia • US Established 2002 2015 2006 1976 FY16 Revenue $34.4M $20.1M $28.6M 1 EBITDA $11.5M $2.5M $4.8M 1 EBITDA Margin 33.3% 12.4% 16.8% Notes: 1. Includes 7.5 months of trading 3 since acquisition to 31 March 2016

FY16 Performance

TIL’s Year in Review 83.1 REVENUE ($m) $83.1m Revenue +127% SEGMENT 36.6 REVENUE & 29.8 EBITDA 26.7 22.6 Home Fragrance, FY12 FY13 FY14 FY15 FY16 Body & Bath $16.3m Natural Products EBITDA EBITDA 16.3 +208% ($M) Distribution 19.7% REVENUE ($M) 14.5% EBITDA MARKET 5.45 REVENUE & 5.3 7.2% EBITDA Dividend 5.0% 4.7% +51% 2.1 1.3 1.1 cents per share Australia New Zealand FY12 FY13 FY14 FY15 FY16 US EBITDA ($m) EBITDA Margin $0.15 UK & Ireland EBITDA EPS (diluted) Asia 5 REVENUE Other

Key Drivers of Record Result EXPANDED INCREASED GROWING MARKET RETAIL CHANNELS INTERNATIONAL SHARE IN KEY PENETRATION Launch of Goodness, a natural GROWTH CATEGORIES skincare range targeting a Combined revenue growth different demographic through Trilogy #1 1 natural skincare of 67% across the US, mass market grocery channel. brand in New Zealand. UK/Ireland and Asia. Very early days for Goodness ECOYA leads the New Launched Trilogy into range but has already achieved Zealand home fragrance 4.8% 3 share in the New Zealand Wholefoods retail in the US market and #2 2 natural skincare grocery which performed better than in Australia. segment. expected. EMERGING 1. Aztec data as at 20/03/16 NZ Pharmacy Facial Skincare MARKETS AND ACQUISITION 2. Aztec data as at 06/03/16 NEW PRODUCTS OF CS&Co AU Pharmacy Facial Skincare SOLIDIFY FUTURE 3. Aztec data MAT to 27/03/16 Completed in August 2015. GROWTH NZ Grocery Facial Skincare Delivering $28.6m in revenue and $4.8m EBITDA Revenue in Asia in its first 7.5 months. exceeded $5m for the first time. 6

FY16 Results Snapshot • Strong revenue growth in Trilogy, Goodness and ECOYA brands. • Momentum maintained in key New Zealand (+78%) and NZ$ m millions FY FY15 FY FY16 Yo YoY Australia (+29%) markets. • Successful marketing driving total revenue growth in the US Sales Sa 36.6 83.1 127% (+231%), UK/Ireland (+54%) and Asia (+42%). Gross p ss profit 22.8 44.8 97% • Disciplined gross margin management. % margin % 62.2% 53.9% • Moderate raw material cost increases, being managed through Trilogy's global supply network. EB EBITDA 5.3 16.3 208% • Significant increase in EBITDA margins. % % margin 14.5% 19.7% • Increased profitability across all brands and all markets while continuing to invest to support expansion of business and EB EBIT 5.0 14.9 221% drive future sales growth. % % margin • 13.5% 19.1% While growing, distribution subsidiary CS&Co, contributes lower margins compared to the NP NPAT AT 4.5 9.4 108% TIL product business, but in line with distribution category. EP EPS 0.07 0.15 7

FY16 Results by Segment • Natural Products segment capitalised on increased global recognition of rosehip oil, with revenue growth of 69% in FY16 and EBITDA growth of 116%. • Continued momentum in Home Fragrance & Bodycare division, achieving 24% revenue growth and 93% EBITDA growth. • Strong EBITDA margin increases achieved across all brands and geographic markets. 34.4 28.6 EBITDA 1 REVENUE 11.5 (NZ$M) (NZ$M) 20.3 20.1 16.1 16.3 16.3 13.5 13.1 10.6 5.3 9.5 4.9 4.8 4.1 3.6 2.5 1.3 FY12 FY13 FY14 FY15 FY16 (0.4) (2.1) (2.5) Natural Products Home Fragrance & Bodycare CS&Co FY12 FY13 FY14 FY15 FY16 8

Cashflow Statement NZ NZ$m FY15 FY FY16 FY Cash Ca h flow from operations ns Receipts from customers (incl. GST) 39.6 89.6 Payments to suppliers / employees (incl. GST) (34.0) (79.2) Interest received 0.0 0.0 • Operating business produced $5.7m net cash, Interest paid (0.4) (1.8) Tax (paid) / received (0.5) (2.9) up 21 % YoY. Net cash inflow / (outflow) from operating activities 4.7 5.7 • Capital expenditure increased in FY16. • Purchases of PPE required to support CS&Co Cash Ca h flow from inv nvesting ng activities integration into Trilogy group. Payment for PPE (0.1) (1.3) Sale of PPE 0.0 0.0 • Increased spend on in store display assets to Payment for intangible assets (0.2) (0.3) support expansion across Trilogy and ECOYA Acquisitions, net of cash acquired 0.0 (33.9) brands. Net cash inflow / (outflow) from investing activities (0.3) (35.5) • Investment in head office and website development. Ca Cash h flow from fina nanc ncing ng activities • Net financing cashflows increased to $30.5m due to debt Proceeds from borrowings 1.9 40.9 funded acquisition of CS&Co. Repayment of borrowings (4.8) (8.2) Net proceeds from issue of shares (0.0) 0.1 Dividends paid 0.0 (2.3) Net cash inflow / (outflow) from financing activities (2.9) 30.5 Net cash flo low 1.5 1. 0.7 0. 9

Balance NZ NZ$m FY15 FY FY16 FY Cash and cash equivalents 2.7 4.4 Trade and other receivables 5.9 14.4 Sheet Derivative financial instruments 0.2 0.1 Inventories 5.0 21.0 Total current assets To 14.8 14 39.9 39 Plant and equipment 1.0 2.7 Intangible assets 17.5 50.4 Deferred tax asset 0.9 0.4 • Increase in total interest-bearing liabilities to $35m To Total non-cu current assets 19 19.4 53.5 53 .5 from debt-funded acquisition of CS&Co. Total assets To 34 34.2 93 93.4 • Net debt / EBITDA rises to 1.9x for FY16, but Trade and other payables 4.9 12.1 remains comfortably within existing debt Provision for tax 0.5 1.2 covenants. Deferred and contingent consideration - 1.5 • Interest bearing liabilities - 4.8 Increase in intangible assets made up of $32.6m Derivative financial instruments - 0.0 goodwill arising from CS&Co acquisition. Total current liabilities To 5.4 5.4 19.0 19 0 • Working capital increase driven by rising inventory Interest bearing liabilities 1.6 30.4 and trade receivables associated with acquisition Deferred and contingent consideration - 8.0 of CS&Co. To Total non-cu current liabilities 1. 1.6 38 38.4 To Total liabilities 7. 7.0 58 58.0 .0 Contributed equity 32.4 32.6 Reserves (1.2) (0.3) (Accumulated losses)/retained earnings (4.0) 3.1 To Total equity 27 27.2 2 35.4 35 10

Dividend • TIL's dividend policy is to pay 45-55% of business earnings excluding CS&Co and after interest and tax. • Allows adequate earnings to be retained to fund initiatives that drive capital growth for Trilogy shareholders and allow for debt repayment. • Full year dividend of 5.45 cents per share, up 51% on FY15. • Dividend fully imputed • Equivalent to 50% of 2016 business earnings excluding CS&Co earnings and after interest and tax. 5.45 3.60 DIVIDEND PAYMENT (CENTS PER SHARE) 11 FY15 FY16

CS&Co FY16 Highlights REVENUE (NZ$M) & Performance +5.0% 13.6 • Acquired by Trilogy International in Aug 2015 42.2 40.2 28.6 • Will commence distribution of Trilogy and Goodness ranges throughout New Zealand from July 2016. FY 15 FY 16A Pro Forma adj FY 16 PF • Achieved 5.0% revenue and 5.5% EBITDA growth 1 (7.5 months) (4.5 Months) • Benefits include: EBITDA • Synergy benefits (NZ$M) • Earnings accretive (contributed 7.5 months of +5.5% earnings to Trilogy International in FY16) • Scale • Export logistics service to the group 1.9 • International distribution contacts 6.7 6.4 4.8 4.8 FY 15 FY 16A Pro Forma adj FY 16 PF (7.5 months) (4.5 Months) Notes: 12 1. Pro Forma (PF) figures are based on management accounts and adjust for the 4.5 months of the twelve month period to 31 March 2016 that CS&Co was not part of Trilogy International