STRAUSS GROUP August 10 th , 2017 Q2 2017 Earnings Presentation - - PowerPoint PPT Presentation

STRAUSS GROUP

August 10th, 2017

Q2 2017 Earnings Presentation

This presentation does not constitute an offering to purchase or sell securities of Strauss Group Ltd. (the “Company”)

• r an offer for the receipt of such offerings. The presentation's sole purpose is to provide information. The information

contained in the presentation and any other information provided during the presentation (the “Information”) does not constitute a basis for investment decisions and does not comprise a recommendation, an opinion or a substitute for the investor's sole discretion. The Information provided in the presentation concerning the analysis of the Company's activity is only an extract, and in order to receive a complete picture of the Company's activity and the risks it faces, one should review the Company's reports to the Israel Securities Authority and the Tel Aviv Stock Exchange. The Company is not liable, and will not be held liable, for any damage and/or loss that may be caused as a result of use of the Information. The presentation may contain forward-looking statements as defined in the Israeli Securities Law, 5728-1968. All forward-looking statements in this presentation are made based on the Company's current expectations, evaluations and forecasts, and actual results may differ materially from those anticipated, in whole or in part, as a result of different factors including, but not limited to, changes in market conditions and in the competitive and business environment, regulatory changes, currency fluctuations or the occurrence of one or more of the Company's risk factors. In addition, forward-looking forecasts and evaluations are based on information in the Company’s possession while preparing the

• presentation. The Company does not undertake any obligation to update forward-looking forecasts and evaluations

made herein to reflect events and/or circumstances that may occur after this presentation was prepared.

.

Disclaimer

2

In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), the Company provides non-GAAP operating results which include the results of jointly controlled entities as if they were proportionately consolidated. Strauss Group has a number of jointly controlled companies: the Três Corações joint venture (3C) - Brazil (a company jointly held by Strauss Group (50%) and by the São Miguel Group (50%) in Brazil), Sabra Dipping Company (a 50%/50% JV with PepsiCo in the U.S. and Canada), Strauss Frito-Lay Ltd. (a 50%/50% JV with PepsiCo Frito-Lay in Israel) and PepsiCo Strauss Fresh Dips & Spreads International (a 50%/50% JV with PepsiCo

• utside the U.S. and Canada)(1).

In addition, non-GAAP figures exclude any share-based payments, mark to market of commodity hedging transactions as at end-of-period, other expenses or income and taxes referring to these adjustments. Company Management believes that these measures provide investors with transparency by helping to illustrate the underlying financial and business trends relating to the Company's results of operations and financial position and comparability between current and prior periods. Management uses these measures to establish and monitor budgets and operational goals and to evaluate the performance of the Company. Please see the GAAP to non-GAAP reconciliation tables in the Company's MD&A Report for a full reconciliation of the Company's GAAP to non-GAAP results.

GAAP to Non-GAAP Reconciliations

3

(1) In Q2'16 the subsidiary Strauss Water signed a series of share exchange and transfer agreements with companies of the Haier Group, as well as a joint venture agreement, with the aim of restructuring the Haier Strauss Water joint venture in China. The change in respect of the above agreements was reflected in the non- GAAP reports commencing in the third quarter of 2015. For further information, see Note 12.6 to the Consolidated Financial Statements as at December 31, 2015.

Gadi Lesin

Strauss Group C.E.O.

4

Q2 2017 Financial Highlights

NIS mm; Non-GAAP

5

(1)

Q2'17 Sales: NIS 2042mm; growth: 5.6% Q2'17 Organic growth excluding FX: 6.2% Q2'17 gross margins: 36.9% (down -100 bps vs. Q1'16) EBIT and EBIT margins: NIS 187mm (up 2.3%); 9.1% (down -30 bps vs. Q2'16) Net income and net margins: NIS 97mm (up 24.9%); 4.8% (down -20 bps vs. Q2'16) EPS: 0.88 (up 20.4% VS. Q2'16) The group declared dividend of NIS 160mm (NIS 1.39 per share) to be paid on September 5th

H1 2017 Financial Highlights

NIS mm; Non-GAAP

6

(1)

YTD 2017 Sales: NIS 4125mm; growth: 8.2% YTD 2017 Organic growth excluding FX: 6.7% YTD 2017 Gross margins: 37.2% (up -110 bps vs. YTD 2016) EBIT and EBIT margins: NIS 410mm (up 3.7%); 9.9% (down -50 bps vs. YTD 2016) Net income and net margins: NIS 213mm (up 15.2%); 5.2% (up 30 bps vs. YTD 2016) EPS: 1.95 (up 13.1% VS. YTD 2016)

Strauss Israel – Growth continues beyond F&B market

• Solid top line growth of 3.4% in comparison to only 0.8% growth for the F&B

market*

• Market share at 11.7%
• Operating profitability is up 4.4%, sustained by continued efficiency

measures and despite the implementation of the employee benefit plan

• Innovation continues – new product launches mainly in confectionary; big

success for “Nishnushim”

• New distribution agreements contribute to results
• We continue to focus on delivering healthier products with less sugar, salt

and fat contents

7

* Source: Storenext

Strauss Coffee – Stellar Top Line Growth of 11.8%

8

• EBIT is up 21.2%
• Growth attributed to increased volumes and selling prices in most geographies
• Very strong performance in International Coffee sales; 14.8% top line growth
• Particularly strong performance in Brazil 3C(1); sales grew by 27.5% (24.6% in LC)

and EBIT a most impressive 77% growth (LC) as R&G sales are back to usual levels

• Positive currency effect – NIS 1 million; mainly impacted by BRL appreciation, NIS 9

million

• 3C(1) market share in Brazil R&G is at 24.2% (2)
• New launches this quarter include MK Café freeze dry in Poland, Ambassador

premium beans and R&G in Russia and Ukraine, new single portion coffee machine and capsules experience in Romania and Nitro cold brew to go in Israel

• The coffee capsules production site in Brazil, a JV of 3C(1) and Caffitaly, is now fully
• perational

(1) Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C) (2) Source: Nielsen

International Dips and Spreads

9

• Sabra recorded a one time charge due to recall – NIS 5.4 million off sales and NIS

11.2 million in other expenses

• Towards the end of the quarter sales gradually returned to normal levels (in USD)
• Sabra is close to pre recall market share levels; currently at 58.4% for the last 4

weeks ending July 9th

• Obela sales in Australia continue to outperform up 31.9% in local currency
• Obela is on track to penetrate the European market via the Florentine platform
• Sabra continues to be a global market leader and the no. 1 producer of Hummus in

North America

Strauss Water

10

• A very strong quarter for Strauss Water with continued improvements on all

fronts; Sales, EBIT and Cash Flows

• Sales up 9.1% during the quarter
• Customer service makes significant strides in improving call center and online

customer satisfaction

• Product innovation continues with the launch of Bubble Plus
• Sales of HSW, water JV in China, grew by 52% in Q2 2017 to NIS 127 million up

from NIS 84 million in Q2 2016 and by 72% in H1 2017 to NIS 245million up from NIS 143 million in H1 2016

• Net profits at HSW more than doubled (up 108%) to NIS 15 million compared to

NIS 7 million in Q2 2016 and up 91% in H1 2017 to NIS 26 million compared to NIS 13 million in H1 2016

Shahar Florence

Strauss Group C.F.O.

11

Q2 2017

12

1,949 1,839 1,933 2,042 500 1000 1500 2000 Q2'14 Q2'15 Q2'16 Q2'17

• Organic growth excluding FX : +6.2%

13

Prior to Food Law

Food Law NIS

• 16mm

Negative translation differences = NIS 13

Strong rong Sales es Growth wth Co Continues tinues 5.6% % in Q2

Q2 2017 17 Cons nsolid

• lidat

ated ed Sales les NIS

S mm; Non-GAA AAP

Q2 2017 Sales by Segment

NIS mm; Non-GAAP; % sales contribution

’17/’16 Growth ’17/’16 Organic growth excl. FX 14

2,042 982 737 178 145 100% 48% 36% 9% 7%

0% 20% 40% 60% 80% 100% 120%

• 500

1,000 1,500 2,000 2,500

Overall Group Strauss Coffee Strauss Israel Dips & Spreads Other

5.6% 11.8% 3.4%

• 9.5%
• 0.7%

6.2% 10.4% 3.4%

• 4.2%

7.7%

1,933 2,042 116 5 (13)

Group sales, secound quarter 2016 Net Organic Growth M&A Effect of Translation Differences * Group sales, secound quarter 2017

Q2 Sales Bridge

15

+6.2% organic growth (1)

NIS mm; Non-GAAP; Q2’16 to Q2’17

(1) Excluding translation differences Primarily due to the weakening of the USD (NIS

• 11mm)

1,933 2,052.4 2,042 91 25 10 5 (13) (9)

Group sales, second quarter 2016 Coffee Strauss Israel Other M&A Effect of Translation Differences * International Dips & Spreads Group sales, second quarter 2017

Q2 Sales Bridge

16 Decline in sales and one time recall charges Higher volumes and improved product mix Primarily due to weakening

• f USD

Sales growth in Strauss-Water;

• ffset by decrease in

Max Brenner Sales

NIS mm; Non-GAAP; Q2'16 to Q2’17

Mainly Higher selling prices and volumes in most markets (1)

(1) Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (“3C”).

768 689 733 753 39.4% 37.4% 37.9% 36.9% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100 200 300 400 500 600 700 800 Q2'14 Q2'15 Q2'16 Q2'17

17

Q2 Consolidated Gross Profit and Gross Margins

NIS mm; Non-GAAP

• excl. FX:

+3.8%

Negative translation differences NIS -8

753 287 318 148 36.9% 38.9% 32.4% 46.0%

• 100

200 300 400 500 600 700 800

Overall Group Strauss Israel Strauss Coffee Dips & Spreads + Other

Slightly higher volumes, affected by higher price of raw materials

Q2 2017 Gross Profit and Gross Margins

NIS mm; Non-GAAP; % Margin

Q2’16 GP & GM

18 Increase in volumes in most countries Lower profits due to continued recall impact

D = 20mm D = 5mm D = 34mm D = -19mm

NIS 733 NIS 282 NIS 284 NIS 167 39.6% 48.7% 37.9% 32.4%

172 112 183 187 8.9% 6.1% 9.4% 9.1% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 20 40 60 80 100 120 140 160 180 200 Q2'14 Q2'15 Q2'16 Q2'17

19

Q2 Consolidated EBIT and EBIT Margins

NIS mm; Non-GAAP

• Q2’17 / Q2’16: 2.3%
• excluding FX : 2.6%

Increased sales in SCBV and S. Israel were offset by lower Sabra sales following recall

Q2 EBIT Bridge

20

Total EBIT up 2.3%

NIS mm; Non-GAAP; Q2’16 to Q2’17

183 187 4

Operating profit, secound quarter 2016 effect of Translation Differences EBIT growth excluding FX Operating profit, secound quarter 2017

187 66 101 6 14

9.1% 8.9% 10.4% 3.6% 9.2

20 40 60 80 100 120 140 160 180 200

Overall Group Strauss Israel Strauss Coffee Dips & Spreads Other

Q2 2017 EBIT and EBIT Margins

NIS mm; Non-GAAP; % Margin

Q2’16 EBIT & EBIT %

21

Sabra still affected by recall

Sales growth, volume and innovation, as well as improved sales mix

Decline in Max

• ffset

increased Water sales

D = 4mm D = 3mm D = 18mm D = -18mm D = 1mm NIS 183 NIS 63 NIS 83 NIS 24 NIS 13 12.1% 8.6% 9.4% 9.6% 8.8%

Sales growth, volume and price in most geographies

227 173 239 243 11.6% 9.4% 12.4% 11.9% 5.0% 7.0% 9.0% 11.0% 13.0% 15.0% 17.0% 19.0% 50 100 150 200 250 300 Q2'14 Q2'15 Q2'16 Q2'17

22

Q2 2017 Consolidated EBITDA and EBITDA Margins

NIS mm; Non-GAAP

Q2 2017 EBITDA and EBITDA Margins

NIS mm; Non-GAAP; % Margin

Q2’16 EBITDA and EBITDA Margins

23

243 88 118 12 25

11.9% 11.9% 12.0% 7.1% 16.7%

50 100 150 200 250

Overall Group Strauss Israel Strauss Coffee Dips & Spreads Other

D = 4mm D = 2mm D = 18mm D = -17mm D = 1mm

NIS 239 NIS 86 NIS 100 NIS 29 NIS 24 15.0% 12.4% 11.3% 12.0% 16.6%

324 347 374 325 290 300 310 320 330 340 350 360 370 380 Q2'14 Q2'15 Q2'16 Q2'17

Sabra Q2 Snapshot

NIS mm; Non-GAAP; for 100% share

Sales EBIT and EBIT Margins

Organic

• excl. FX
• 10.1%

24

Note: Sabra Dipping Company (“Sabra”) is a company jointly held by PepsiCo (50%) and Strauss Group (50%) .

46 28 54 18

14.3% 7.9% 14.5% 5.6% 0.0% 5.0% 10.0% 15.0% 20.0%

• 10

20 30 40 50 60 Q2'14 Q2'15 Q2'16 Q2'17

Recall effect

626 753 939

Q2'15 Q2'16 Q2'17

181 203 269 28.9% 26.9% 28.7%

Q2'15 Q2'16 Q2'17

50 61 108

Q2'15 Q2'16 Q2'17

Três Corações Alimentos S.A. (Três Corações J.V.)

Q2 Snapshot

BRL mm for 100% ownership and including inter-company sales Sales GP and GM EBIT and EBIT Margins (1)

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C). Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 3oth, 2017. (1) EBIT before Other Expenses/ Income.

25

69 31 78 97

3.5% 1.7% 4.0% 4.8%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0%

• 20

40 60 80 100 120 Q2'14 Q2'15 Q2'16 Q2'17

Q2 Net Profit (attributed to the Company’s shareholders), Net Margins and EPS

NIS mm; Non-GAAP

EPS

26

0.64 0.29 0.73 0.88

Q2 Net Profit (attributed to the Company’s

shareholders) Bridge

NIS mm; Non-GAAP; Q2'16 to Q2’17

27

78 97 4 15 15 (15)

Net Income Q1 2016 EBIT Finance exp. Taxes on income Non controlling interest Net Income Q2 2017

Net Debt and Net Debt /EBITDA (LTM) declines to 2.2x from 2.7x in Q1 2017

Non-GAAP EBITDA, net debt includes partnerships; NIS mm

28

1,720 1,833 1,574 2,138

1.8x 2.0x 1.6x 2.2x

• 0.5x

1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x 500 1,000 1,500 2,000 2,500 Q2 2014 Q2 2015 Q2 2016 Q2 2017

Q2 GAAP and Non-GAAP Financial Highlights

NIS mm

(1) Capex includes acquisition of fixed assets and investment in intangible assets.

29

GAAP Adjusted Non-GAAP Q2 2017 Q2 2016 % Chg. Q2 2017 Q2 2016 % Chg. Sales 1,288 1,273 1.1% 2,042 1,933 5.6% Gross Profit 491 526 (6.6%) 753 733 2.7% GP Margin 38.2% 41.3% 36.9% 37.9% Operating Profit 146 187 (22.5%) 187 183 2.3% EBIT Margin 11.3% 14.8% 9.1% 9.4% Net Profit (to SH) 73 69 4.1% 97 78 24.9% NP Margin 5.6% 5.5% 4.8% 4.1% Operating Cash Flow 154 232 199 296 Capex (1) (49) (39) (71) (57) Net debt 1,818 1,427 2,138 1,574 Change in WC (CF) 53 112 34 114

30

Thank You!

For further details please contact: Daniella Finn| Investor Relations Phone: + 972-3-675-2545 Mobile: + 972-54-577-2195 Daniella.finn@Strauss-Group.com www.strauss-group.com

Appendix

31

Appendix

H1 2017

Additional information

32

H1 2017 GAAP and Non-GAAP Financial Highlights

NIS mm

(1) Capex includes acquisition of fixed assets and investment in intangible assets.

33

GAAP Adjusted Non-GAAP YTD 2017 YTD 2016 % Chg. YTD 2017 YTD 2016 % Chg. Sales 2,696 2,594 3.9% 4,125 3,813 8.2% Gross Profit 1,059 1,060 (0.1%) 1,533 1,459 5.1% GP Margin 39.3% 40.9% 37.2% 38.3% Operating Profit 347 393 (11.9%) 410 396 3.7% EBIT Margin 12.9% 15.2% 9.9% 10.4% Net Profit (to SH) 180 173 3.7% 213 185 15.2% NP Margin 6.7% 6.7% 5.2% 4.9% Operating Cash Flow 96 179 113 270 Capex (1) (92) (78) (132) (113) Net debt 1,818 1,427 2,138 1,574 Change in WC (CF) (144) 4 (244) (30)

3,922 3,769 3,813 4,125 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 YTD14 YTD15 YTD16 YTD17

Sales es grew w 8.2% % in H1 2017

Food

• d & b

beve verage age market rket grew ew a slower wer 1.5% % (1)

H1 2017 Conso soli lidate ted Sale les s NIS mm; Non-GAAP

GAAP

34

Prior to Food Law

Food Law NIS

• 32mm

Positive translation differences = NIS 38

• Q2’17 / Q2’16: +8.2%
• Organic growth excluding FX : +6.7%

(1) Source: Storenext

H1 2017 Sales by Segment

NIS mm; Non-GAAP; % sales contribution

’17/’16 Growth ’17/’16 Organic growth

• excl. FX

35

4,125 1,943 1,555 338 289 100% 47% 38% 8% 7%

0% 20% 40% 60% 80% 100% 120%

• 500

1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 Overall Group Strauss Coffee Strauss Israel Dips & Spreads Other

8.2% 17.2% 4.5%

• 11.5%

1.2% 6.7% 11.7% 4.5%

• 7.8%

6.7%

H1 2017 Sales Bridge

36

+6.7% organic growth (1)

NIS mm; Non-GAAP; H1 2016 to H1 2017

(1) Excluding translation differences Primarily BRL (NIS +67mm)

3,813 4,125 260 14 38

Group sales, first half 2016 Net Organic Growth M&A Effect of Translation Differences * Group sales, first half 2017

3,813 4,139.0 4,125 203 67 38 18 15 (29)

Group sales, first half 2016 Coffee Strauss Israel Effect of Translation Differences * Other M&A International Dips & Spreads Group sales, first half 2017

H1 2017 Sales Bridge

37

NIS mm; Non-GAAP; H1 2016 to H1 2017

Primarily BRL NIS -75mm Higher volumes and higher selling prices in most markets, mainly in Brazil 3C

Higher volumes and improved mix; offset by higher material costs Sales growth in Strauss-Water; offset by decrease in Max Brenner Sales Decline in sales following recall

(1) Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (“3C”).

1,558 1,418 1,459 1,533 39.7% 37.6% 38.3% 37.2% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

• 200

400 600 800 1,000 1,200 1,400 1,600 1,800 YTD14 YTD15 YTD16 YTD17

38

H1 2017 Consolidated Gross Profit and Gross Margins

NIS mm; Non-GAAP

• excl. FX:

+4.9%

Positive translation differences NIS 3

H1 2017 Gross Profit and Gross Margins

NIS mm; Non-GAAP; % Margin

H1 2016 GP & GM

39

1,533 620 627 286 37.2% 39.8% 32.3% 45.8%

• 30

170 370 570 770 970 1,170 1,370 1,570 1,770

Overall Group Strauss Israel Strauss Coffee Dips & Spreads + Other

D = 74mm D = 27mm D = 87mm D = -40mm

NIS 1459 NIS 593 NIS 540 NIS 326 38.3% 32.6% 39.9% 48.4%

376 309 396 410 9.6% 8.2% 10.4% 9.9% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

• 50

100 150 200 250 300 350 400 450 YTD14 YTD15 YTD16 YTD17

40

H1 2017 Consolidated EBIT and EBIT Margins

NIS mm; Non-GAAP

• H1 2017 / H1 2016: +3.7%
• excluding FX : +2.7%

396 410 10 4

YTD'16 EBIT EBIT growth excluding FX effect of Translation Differences YTD'17 EBIT

H1 2017 EBIT Bridge

41

Total EBIT up 3.7% EBIT exc. Translation differences up 2.8%

NIS mm; Non-GAAP; H1 2016 to H1 2017

485 425 508 521 12.4% 11.3% 13.3% 12.6% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0% 100 200 300 400 500 600 YTD14 YTD15 YTD16 YTD17

42

H1 2017 Consolidated EBITDA and EBITDA Margins

NIS mm; Non-GAAP

410 171 192 23 24 9.9% 11.0% 9.9% 6.7%

8.2%

• 30

20 70 120 170 220 270 320 370 420 470

Overall Group Strauss Israel Strauss Coffee Dips & Spreads Other

H1 2017 EBIT and EBIT Margins

NIS mm; Non-GAAP; % Margin

H1 2016 EBIT & EBIT %

43

D = 14mm D = 10mm D = 29mm D = -28mm D = 3mm NIS 396 NIS 161 NIS 163 NIS 51 NIS 21 13.3% 7.1% 10.4% 9.9% 10.8%

H1 2017 EBITDA and EBITDA Margins

NIS mm; Non-GAAP; % Margin

H1 2016 EBITDA and EBITDA Margins

44

521 215 224 35 47

12.6% 13.8% 11.5% 10.4% 16.1%

100 200 300 400 500 600

Overall Group Strauss Israel Strauss Coffee Dips & Spreads Other

D = 13mm D = 7mm D = 30mm D = -27mm D = 3mm

NIS 508 NIS 208 NIS 194 NIS 62 NIS 44 13.3% 11.7% 14.0% 15.4% 16.3%

H1 2017 Net Profit (attributed to the Company’s shareholders), Net Margins and EPS

NIS mm; Non-GAAP

EPS

45

168 133 185 213

4.3% 3.5% 4.9% 5.2%

• 1.0%

1.0% 3.0% 5.0% 7.0% 9.0% 11.0%

• 50

100 150 200 250 YTD14 YTD15 YTD16 YTD17

1.57 1.24 1.73 1.95

H1 2017 Net Profit Bridge (attributed to the Company’s shareholders)

NIS mm; Non-GAAP; H1 2016 to H1 2017

46

185 213 14 20 11 (17)

Net Income H1 2016 EBIT Finance exp. Taxes on income Non controlling interest Net Income H1 2017

84 67 115 56 13.8% 9.7% 15.9% 9.1% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

• 20

40 60 80 100 120 140 YTD14 YTD15 YTD16 YTD17 609 694 724 613 550 600 650 700 750 YTD14 YTD15 YTD16 YTD17

Sabra H1 2017 Snapshot

NIS mm; Non-GAAP; for 100% share

Sales EBIT and EBIT Margins

Organic

• excl. FX:
• 10.1%

47

Note: Sabra Dipping Company (“Sabra”) is a company jointly held by PepsiCo (50%) and Strauss Group (50%) .

109 104 143

9.3% 7.5% 8.4%

YTD15 YTD16 YTD17

356 367 450

30.2% 26.5% 26.5%

YTD15 YTD16 YTD17

1,178 1,383 1,699

YTD15 YTD16 YTD17

Três Corações Alimentos S.A. (Três Corações J.V.)

H1 2017 Snapshot

BRL mm for 100% ownership and including inter-company sales Sales GP and GM EBIT and EBIT Margins (1)

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C). Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 30st, 2017. (1) EBIT before Other Expenses/ Income.

48

Appendix

Strauss Group

49

50

Local Currencies vs. the NIS

Current exchange rate as of June 30th, 2017.

RUB BRL AUD USD CAD PLN CHF EUR RSD RON UAH CNY MXN GBP H1'17/H1'16 14.5% 10.4%

• 2.4%
• 5.1%
• 5.4%
• 5.9%
• 6.3%
• 8.0%
• 8.4%
• 8.9%
• 9.7%
• 9.7%
• 11.7%
• 16.7%

Q2'17/Q2'16 8.7% 2.8%

• 5.2%
• 5.9%
• 9.7%
• 5.0%
• 7.2%
• 8.3%
• 8.3%
• 9.5%
• 10.0%
• 10.4%
• 8.2%
• 16.1%
• 20.0%
• 15.0%
• 10.0%
• 5.0%

0.0% 5.0% 10.0% 15.0% 20.0%

Change in average exchange rate (1 local currency = x NIS)

51

Local Currencies vs. the USD

Current exchange rate as of June 30th, 2017.

RUB BRL ILS PLN RSD RON UAH H1'17/H1'16 20.6% 16.2% 5.4%

• 0.8%
• 3.4%
• 4.0%
• 4.8%

Q2'17/Q2'16 15.4% 9.2% 6.2% 1.0%

• 2.6%
• 3.8%
• 4.3%
• 10.0%
• 5.0%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

Change in average exchange rate (1 local currency = x USD)

Appendix

Strauss Israel

52

Strauss Israel Non-GAAP Financial Highlights Q2 2017 NIS mm

53

Note: Figures were rounded to NIS millions. Totals were calculated on the basis of the exact figures in NIS thousands.

Strauss Israel (Non GAAP) YTD 2017 YTD 2016 % Chg. Q2 2017 Q2 2016 % Chg. Revenue: H&W 1,002 965 3.8% 516 491 5.0% F&I 553 523 5.8% 221 221 (0.0%) Total Revenue 1,555 1,488 4.5% 737 712 3.4% Total Gross Profit 620 593 4.4% 287 282 1.6%

Gross Margins

39.8% 39.9% (0.0%) 38.9% 39.6% (0.7%)

EBIT: H&W 108 99 8.9% 55 48 13.7%

Margins

10.7% 10.2% 0.5% 10.6% 9.7% 0.8%

F&I 63 62 2.1% 11 15 (25.8%)

Margins

11.4% 11.9% (0.4%) 4.9% 6.7% (1.7%)

Total EBIT 171 161 6.3% 66 63 4.4%

Margins

11.0% 10.8% 0.2% 8.9% 8.8% 0.1%

EBITDA: H&W 135 128 5.4% 68 62 9.6%

Margins

13.4% 13.2% 0.2% 13.2% 12.6% 0.6%

F&I 80 80 0.1% 20 24 (18.2%)

Margins

14.5% 15.3% (0.8%) 8.8% 10.7% (1.9%)

Total EBITDA 215 208 3.4% 88 86 1.9%

Margins

13.8% 14.0% (0.1%) 11.9% 12.0% (0.2%)

1,503 1,431 1,488 1,555 400 600 800 1,000 1,200 1,400 1,600 1,800 YTD14 YTD15 YTD16 YTD17

H1 2017 Strauss Israel Sales

NIS mm; Non-GAAP

54

713 678 712 737

• 100

200 300 400 500 600 700 800 Q2'14 Q2'15 Q2'16 Q2'17

Q2 Strauss Israel Sales

NIS mm; Non-GAAP

55

H1 2017 Strauss Israel EBIT and EBIT Margins

NIS mm; Non-GAAP

56

166 136 161 171 11.0% 9.5% 10.8% 11.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

• 20

40 60 80 100 120 140 160 180 YTD14 YTD15 YTD16 YTD17

68 44 63 66 9.5% 6.5% 8.8% 8.9% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

• 10

20 30 40 50 60 70 80 Q2'14 Q2'15 Q2'16 Q2'17

Q2 Strauss Israel EBIT and EBIT Margins

NIS mm; Non-GAAP

57

Target Milk Price (NIS per liter)

Price excluding Strauss transportation costs

Milk

2.14 2.14 2.14 2.34 2.36 2.29 2.20 2.26 2.12 2.14 2.29 2.19 2.19 2.11 1.97 1.95 1.89 1.88 1.86 1.86 1.93 1.98 2.01 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

London Sugar Historical & Futures Prices 2014-2017 ($\T)

2015 Avg. 374 2014 Avg. 440 2017 Avg. 474 2016 Avg. 500

Futures

Sugar

Futures

London Cocoa Historical & Futures Prices 2014-2017 (GBP\T)

2015 Avg. 2,101 2014 Avg. 1,923 2017 Avg. 1,593 2017 Avg. 2,188

Cocoa

Futures

Appendix

Strauss Coffee

61

Strauss Coffee Non-GAAP Financial Highlights

Q2 2017 NIS mm

62

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (“3C”). Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil). Note: Figures were rounded to NIS millions. Totals were calculated on the basis of the exact figures in NIS thousands.

Strauss Coffee (Non GAAP) YTD 2017 YTD 2016 % Chg. Q2 2017 Q2 2016 % Chg. Revenue: Israel 361 347 4.0% 149 153 (2.4%) International 1,582 1,310 20.7% 833 724 14.8% Total Revenue 1,943 1,657 17.2% 982 877 11.8% Total Gross Profit 627 540 16.0% 318 284 11.9%

Gross Margins

32.3% 32.6% (0.2%) 32.4% 32.4% (0.1%)

EBIT: Israel 57 52 8.4% 17 17 (2.4%)

Margins

15.7% 15.1% 0.6% 11.2% 11.2% 0.0%

International 135 111 22.5% 84 66 27.2%

Margins

8.6% 8.5% 0.1% 10.2% 9.2% 1.0%

Total EBIT 192 163 18.0% 101 83 21.2%

Margins

9.9% 9.9% 0.1% 10.4% 9.6% 0.8%

EBITDA: Israel 63 58 8.4% 20 20 (1.1%)

Margins

17.4% 16.7% 0.7% 13.3% 13.1% 0.1%

International 161 136 18.5% 98 80 23.2%

Margins

10.2% 10.4% (0.2%) 11.8% 11.0% 0.7%

Total EBITDA 224 194 15.5% 118 100 18.3%

Margins

11.5% 11.7% (0.2%) 12.0% 11.3% 0.7%

Strauss Coffee Non-GAAP Sales by Geography

H1 2017 & Q2 NIS mm

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (“3C”). Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil). Note: Figures were rounded to NIS millions. Totals were calculated on the basis of the exact figures in NIS thousands.

63 Strauss Coffee Sales % Change % Change YTD 2017 YTD 2016 NIS Local Currency Q2 2017 Q2 2016 NIS Local Currency Israel 361 347 4.0% 4.0% 149 153 (2.4%) (2.4%) International: Três Corações Joint Venture (Brazil) 974 727 34.1% 22.7% 524 411 27.5% 24.6% CIS 297 262 12.9% 5.6% 149 141 5.3% 2.0% Poland 144 135 6.8% 13.5% 70 68 3.2% 8.5% Romania 106 128 (17.1%) (8.9%) 55 66 (16.6%) (7.8%) Serbia 61 58 4.8% 14.6% 35 38 (10.3%) (2.1%) Total International 1,582 1,310 20.7% 15.4% 832 724 14.8% 14.7% Total Coffee 1,943 1,657 17.2% 13.1% 982 877 11.8% 11.7%

1,774 1,681 1,657 1,943

• 500

1,000 1,500 2,000 2,500 YTD14 YTD15 YTD16 YTD17

H1 2017 Strauss Coffee Sales

NIS mm; Non-GAAP

Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil).

Organic growth +11.7%

64

908 835 877 982

• 200

400 600 800 1,000 1,200 Q2'14 Q2'15 Q2'16 Q2'17

Q2 2017 Strauss Coffee Sales

NIS mm; Non-GAAP

Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil).

Organic growth +10.4%

65

179 136 163 192 10.1% 8.1% 9.9% 9.9% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

• 50

100 150 200 250 YTD14 YTD15 YTD16 YTD17

H1 2017 Strauss Coffee EBIT and EBIT Margins

Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil).

66

NIS mm; Non-GAAP

89 50 83 102 9.8% 5.9% 9.6% 10.4% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

• 20

40 60 80 100 120 Q2'14 Q2'15 Q2'16 Q2'17

Q2 Strauss Coffee EBIT and EBIT Margins

NIS mm; Non-GAAP

Strauss Coffee non-GAAP figures represent 50% share in Três Corações joint venture (Brazil).

67

Robusta Historical & Futures Prices 2014-2017 ($\T)

2015 Avg. 1,715 2014 Avg. 2,003 2017 Avg. 2,104 2016 Avg. 1,742

Futures

Robusta

Futures

Arabica Historical & Futures Prices 2014-2017 (Cent\Lb)

2015 Avg. 134 2014 Avg. 178 2017 Avg. 137 2016 Avg. 136

Arabica

Futures

NY Arabica and Brazil Arabica

Indexed since 8.8.2012

Source : Bloomberg

70

NY Arabica (traded in USD) Brazil Arabica (traded in BRL)

Appendix

Sabra & Obela

71

Strauss D&S Non-GAAP Financial Highlights

Q2 2017 NIS mm; 50% share

• Figures were rounded to NIS millions. Totals were calculated on the basis of the exact figures in NIS thousands.

72

Dips & Spreads (Non GAAP) YTD 2017 YTD 2016 % Chg. Q2 2017 Q2 2016 % Chg. Revenue: Sabra (50%) 307 362 (15.3%) 163 187 (13.0%) Obela (50%) 31 20 56.1% 15 10 58.3% Total Revenue 338 382 (11.5%) 178 197 (9.5%) EBIT: Sabra (50%) 28 58 (51.5%) 9 27 (66.3%)

Margins

9.1% 15.9% (6.8%) 5.6% 14.5% (8.9%)

Obela (50%) (5) (7)

NM

(3) (3)

NM

Margins

NM NM NM NM NM NM

Total EBIT 23 51 (55.5%) 6 24 (73.3%)

Margins

6.7% 13.3% (6.7%) 3.6% 12.1% (8.5%)

Total EBITDA 35 62 (43.4%) 12 29 (57.0%)

Margins

10.4% 16.3% (5.9%) 7.1% 15.0% (7.9%)

Humera Sesame Prices 2014-2017 (USD/Metric Ton)

73

2017 Avg. 1,184 2015 Avg. 1,324 2016 Avg. 1,108 2014 Avg. 2,121

Appendix

Strauss Water

74

273 240 238 261 220 230 240 250 260 270 280 YTD14 YTD15 YTD16 YTD17

H1 2017 Strauss Water Non-GAAP Sales

Non-GAAP; NIS mm

75

135 120 124 135 110 115 120 125 130 135 140 Q2'14 Q2'15 Q2'16 Q2'17

Q2 2017 Strauss Water Non-GAAP Sales

Non-GAAP; NIS mm

76

Appendix

Max Brenner

77

23 25 23 10

• 5

10 15 20 25 30 Q2'14 Q2'15 Q2'16 Q2'17

Q2 2017 Max Brenner Sales*

Non-GAAP; NIS mm

Organic decline excluding FX: -13.0%

78

*Max Brenner was sold in May 2017

52 53 48 28 10 20 30 40 50 60 YTD14 YTD15 YTD16 YTD17

H1 2017 Max Brenner Sales*

Non-GAAP; NIS mm

Organic decline excluding FX: - 16.9%

79

* Max Brenner was sold in May 2017