UAC of Nigeria Plc Investor Presentation September 2019 Disclaimer - - PowerPoint PPT Presentation

UAC of Nigeria Plc Investor Presentation

September 2019

This presentation contains forward-looking statements which reflect management's expectations regarding UAC of Nigeria Plc's (“UAC”, the “Company” or “HoldCo”) future growth, results of operations, performance, business prospects, operating markets and opportunities. Wherever possible, words such as "anticipate", "believe", "expects", "intend" "estimate", "project", "target", "risks", "goals" and similar terms and phrases have been used to identify forward-looking statements. These statements reflect management's current beliefs and are based on information currently available to management. Certain material factors or assumptions have been applied in drawing the conclusions contained in forward-looking statements. These factors or assumptions are subject to inherent risks and uncertainties surrounding future expectations generally. UAC cautions readers that a number of factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in forward-looking statements. These factors should be considered carefully and undue reliance should not be placed on forward-looking statements. For additional information with respect to UAC’s financial performance, reference should be made to the Company’s periodic filings with the Nigerian Securities and Exchange Commission and The Nigerian Stock Exchange. The Company disclaims any intention

• r obligation to update or revise any forward-looking statements, whether as a result of new information, future

events or otherwise.

2

Disclaimer

Overview and Strategic Focus 4 Governance and People 11 Operating Segments 16 H1 2019 Performance 57 Risks to Outlook 64 Conclusion 67 Appendix 69

Contents

3

Overview and Strategic Focus

Introduction

5

• UAC of Nigeria PLC (“UAC”, the “Company” or “HoldCo”) is a holding company that owns businesses with

some of Nigeria’s strongest brands and widest distribution

• Our businesses are largely consumer facing and positioned to benefit from Nigeria’s demographics
• Large, young and growing population
• Urbanization
• Through disciplined capital allocation and focus on operational improvements, we position our businesses for

meaningful earnings growth even during challenging macro-economic conditions

• We prioritise sound corporate governance practices and compliance in building well run companies. We are

growing our ESG capabilities and aim to weave this into the fabric of our businesses

• We anchor investment and operational decisions on improving return on invested capital (ROIC) with a

portfolio-wide target of 25%

• Our immediate priority remains implementing our announced solution to the challenges relating to our real

estate business – we expect to recapitalise UPDC to significantly reduce leverage and exit the business

• In the long term, we aim to build some of Nigeria’s most valuable and sustainable businesses

25% 27% 35% 14% 0% (1%) QSR Logistics Paints Packaged Food and Beverages

UAC Overview

(1) Converted at ₦362.32/$1 as at 23 August 2019

• UAC is a public company listed on The Nigerian Stock Exchange
• The Company generated H1 2019 revenues and EBIT of ₦41.6bn

($114.7mn1) and c.₦3.0bn ($8.2mn1) respectively, a 7.1% margin

• UAC is active in 6 sectors – animal feeds and other edibles, packaged

food and beverages, paints, logistics, quick service restaurants (“QSR”) and real estate

• UAC has strategic partnerships in 3 of its operating segments –

logistics, QSR, and packaged food and beverages

6

• Tiger Brands is a leading African FMCG company
• Acquired a 49% stake in UAC Foods in 2010
• Imperial Logistics is a leading logistics and mobility

company with operations across Africa and Europe

• Acquired a 49% stake in MDS in 2013; in the process of

acquiring a further 8% to gain control

• Famous Brands is Africa’s largest QSR franchisor
• Acquired a 49% stake in UAC Restaurants in 2013

Overview Strategic Partnerships H1 2019 Revenue Breakdown H1 2019 Invested Capital Breakdown H1 2019 EBIT Breakdown

56% 20% 13% 6% 1% 4% 38% 11% 5% 10% 1% 35% Animal Feeds and Other Edibles Real Estate

Core to UAC’s strengths are its brands and distribution

7 Packaged Food and Beverages Animal Feeds and Other Edibles Paints Logistics QSR

• National distribution coverage
• 35 million units of snacks, water and dairy sold

Brands Reach/Monthly Sales

• 5 production facilities providing national coverage
• 30 thousand Metric Tonnes output
• 86 retail outlets
• 800 thousand litres of paint
• 120 thousand sq.m of warehouse space across 51 locations
• 370 thousand km of distribution coverage
• 90 stores across Nigeria
• 450 thousand unique transactions

Our strategic focus is anchored on three pillars

8 People and Governance

• Boards: construct boards of directors with the right mix of skills, experience and independence to provide oversight,

establish strong internal controls and shape strategy

• Management: attract and retain the strongest possible management teams for each of our businesses. Focus on

performance management, learning and development, as well as, incentives

• Culture: focus on performance, accountability and policy adherence. Zero tolerance for governance breaches

Structure

• UPDC: recapitalise UPDC and exit
• Paints: address inefficiency of owning two listed businesses in the paint segment
• Animal Feeds: explore consolidation of ownership, production facilities, procurement and routes-to-market

Growth and Returns

• Capital Allocation: driven by long-term ROIC and growth potential
• Efficiency: invest to improve operational efficiency and introduce technology to enhance margins and ROIC
• Growth: capture high ROIC growth opportunities in our paints, logistics and packaged food and beverages

segments

1 2 3

Strategic positioning for our operating segments

9 Based on long-term ROIC, growth potential and industry position, we adopt one of three strategic options

Optimise

• Improve feeds margins (procurement and conversion)
• Grow higher margin edibles segment
• Rationalise excess capacity

Optimise and Grow

• Asset light value added logistics, high ROIC transport

Optimise and Grow

• Invest in new, efficient plant, extend product range

Exit

• Recapitalise to paydown short-term obligations
• Exit via an unbundling to shareholders

Under review

• Evaluating business model and ability to scale

Logistics Packaged Food and Beverages Real Estate QSR

Grand Cereals Company EBIT Invested Capital Strategic Positioning ₦ mn % margin

% of total

₦ mn ROIC Livestock Feeds CAP Portland Paints MDS UAC Foods UPDC

% of total

Animal Feeds and Other Edbiles Paints

UAC Restaurants 703 110 1,040 88 436 888 (46) 4 3.8% 2.3% 26.8% 6.5% 15.5% 10.7% (3.0%) 0.6% 21.8% 3.4% 32.2% 2.7% 13.6% 27.5% 0.1% 22,256 1,457 1,780 1,591 6,151 7,041 21,991 799 35.3% 2.3% 2.8% 2.5% 9.8% 11.2% 34.9% 1.3% 4.3% 10.2% 79.4% 7.7% 9.7% 17.2% (0.3%) 0.7% (1.4%) Grow

• Deepen colour centre/shop penetration
• Broaden product mix
• Cater for customers seeking value
• Rationalise Portland Paints excess capacity

H1 2019 EBIT and Invested Capital (i) Invest for growth (ii) Optimise – drive margin and asset turnover (iii) Exit

1 2 3

Note: Figures are subject to rounding differences

Attractive growth markets

Key investment highlights

10

• Exposure to large consumer facing segments that will benefit from Nigeria’s demographics
• Animal Feeds: demand driven by population and increasing urbanization
• Packaged Food and Beverages: disproportionately benefit from urbanization as consumers seek convenience
• Paints: will benefit from rising housing demand and home renovations
• Logistics: underpins broader economic activity; shift to third-party logistics will drive growth

Strong market positions

• UAC is a market leader in its key segments and is well positioned to capture growth
• Animal Feeds: #1 player in fish feed and #2 player in poultry feed
• Decorative Paints: #1 player by value; strong leadership in the premium segment
• Packaged Food and Beverages: #1 player in the long-life sausage roll segment; #2 player in mass market ice-cream, and

leading spring water brand

• Logistics: Leading integrated third-party logistics provider, attractive network of warehouse assets nationwide

Margin expansion from operational improvements

• Management: new management teams at the Holdco and for businesses representing 82% of operating profit
• Demonstrated ability to improve operating margins: operating margins in our packaged food and beverages business

improved +344bps from improvements to procurement, conversion and route-to-market

• Replicable Model: tool-kit applied for packaged food and beverages business can be replicated across the portfolio

Tangible near term growth opportunities

• Packaged Food and Beverages: expand snacks and water capacity to meet demand
• Paints: deepen distribution and broaden product range to include value offering and industrial products
• Logistics: recently executed high ROIC dedicated transport contracts that will drive earnings growth

Governance and People

Strengthened board via introduction of non-executives with finance and capital allocation experience

12

• Engr. Okechukwu Mbonu

Non-Executive Director

• Prior leadership roles at PwC Nigeria and

Nigerian Breweries PLC

• Partner at Execution Edge Limited
• Experienced on corporate governance,

technical and human capital matters

• Mr. Babatunde Kasali

Non-Executive Director

• Chairman at Wema Bank PLC
• Prior leadership roles at EY and UBA
• Extensive experience in audit and risk

Management

• Mrs. Suzanne Iroche

Non-Executive Director

• Prior leadership roles at Chartered Bank,

United Bank for Africa and FinBank

• Experienced in finance, governance and

risk management

• Sits on the Boards of Coronation Merchant

Bank and FCMB Pension Managers

• Mr. Bolaji Odunsi

Non-Executive Director

• Prior leadership roles at Stirling Square

Capital, Compass Partners and BC Partners

• Financier and investor with significant

experience on business transformations and corporate turnarounds

• Mr. Peter Mombaur

Alternate Director

• Prior leadership roles at Tana Africa and

McKinsey

• Considerable FMCG experience with

Promasidor

• Chairman, UAC Foods
• Mr. Daniel Agbor

Chairman

• Senior Partner at Udo Udoma & Belo-

Osagie

• Legal, regulatory and corporate

governance experience

• Dr. Umaru Alka

Non-Executive Director

• Expert in environmental pollution and

conservation

• Prior leadership role at the Bauchi State

Water Board

• Valuable to the Board on governance and

ESG initiatives

New Non-Executive Directors

Revamped executive management at HoldCo…

13

• Mr. Ibikunle Oriola

Group Finance Director

• Mr. Folasope Aiyesimoju

Group Managing Director

• Dr. Vitus Ezinwa

Group Human Resources Director Appointed 8 March 2019 Appointed 1 November 2018 Appointed 1 April 2019

• Experienced finance professional and

investor

• Founder of Themis Capital, an active

investment company

• Prior roles at KKR, Standard Bank, and

Ocean and Oil Holdings

• CFA charter holder with a B.Sc (Hons)

degree in Estate Management from the University of Lagos

• Seasoned finance professional
• Prior CFO roles at ARM and Transcorp
• Extensive corporate finance experience at

Ecobank Capital and KPMG

• Fellow of the Institute of Chartered

Accountants of Nigeria (ICAN) with a B.Sc degree in Finance from the University of Lagos

• Experienced business executive and HR

professional

• Prior leadership roles at TGI, Promasidor,

Coca-Cola and British American Tobacco

• Fellow of the Chartered Institute of

Personnel and Development (CIPD) UK

• Masters in Applied Business Research and

a Doctorate in Business Administration, both from Swiss Business School (Zurich)

…and key portfolio companies, representing 82% of Group

• perating profit

14

• Seasoned business executive with

significant experience in the FMCG space

• Prior leaderships roles at PZ Cussons,

Guinness Nigeria, British American Tobacco and Procter & Gamble

• Fellow of the National Institute of

Marketing of Nigeria with a B.Sc in Biochemistry from the University of Port- Harcourt

• Experienced business executive with over

30 years of experience in FMCG

• Prior roles include MD Heineken, Central &

East Africa; MD Heineken Hungary; Commercial Director, Nigerian Breweries

• Past Special Adviser to the Minister of

Trade & Investment (Nigeria)

• PhD in Mechanical and Process

Engineering, University of Strathclyde

• Experienced manufacturing and
• perations executive with competence in

lean manufacturing

• Prior leadership roles at Kansai Paints, Akzo

Nobel, Blackfriar-Glixtone and Hempel

• B.Sc in Chemical Engineering from the

University of Bradford, UK

• Dr. Dele Ajayi

MD, UAC Foods Limited

• Mr. Alex Goma

MD, Grand Cereals Limited

• Mr. David Wright

MD, CAP PLC Appointed July 2018 To Start October 2019 Appointed August 2019

New talent recruited across our portfolio companies

15

• CEO (ex. Heineken International,

Nigerian Breweries)

• CFO (ex. Dangote, Diageo)
• GM Manufacturing

(ex. Nigerian Bottling Company)

• GM Sales (ex. Glo, Unilever,

Dangote)

• GM Marketing (ex. Cadbury)
• GM Supply Chain (ex. CAP)
• Innovations Manager

(ex. PZ Cussons)

• Market Insights Manager

(ex. Kantar TNS)

• CFO (ex. PwC, Honeywell)
• CCO (ex. Broll, Landmark, Stanbic

IBTC, Lloyds, HSBC)

• Head, Project Development (ex.

Shell Real Estate)

• Senior Advisor

(ex. Actis Real Estate) UPDC Hotel

• General Manager (ex. RLI Kendeja

Resort & Villas, Corinthia Hotels)

• CFO (ex. PwC and Transcorp

Hotels)

• Head, Sales (ex. Curzon & Jones)
• CEO (ex. PZ Cussons, Guinness

Nigeria, British American Tobacco)

• HR Director

(ex. GE Energy, GlaxoSmithKline, British American Tobacco)

• Head, Sales (ex. Sunseed Nigeria)
• Senior Advisor (ex. Proterra, Black

River)

• CEO (ex. Kansai Paints, Hempel,

AkzoNobel)

• HR Director

(ex. Promasidor, Coca-Cola, TGI)

• GM, Capability Development (ex.

Plascon, International Paints)

• Head Legal (ex. United Capital,

Banwo & Ighodalo)

On-going efforts to strengthen teams across our businesses

Operating Segments

Real Estate

(-1%) of operating income

1,200 1,492 H1 2018 H1 2019

Snapshot of UPDC

• Established in 1997 and carved out of UAC’s property division to
• perate as a subsidiary
• Listed on The NSE in 1998, and set up UPDC REIT in 2013, where it

holds a 61.5% equity stake

• UPDC’s operating model is based on asset development for sale and

recurring income from investment properties. UPDC is also focused

• n optimizing its hospitality asset
• Development track record comprised of a diverse asset mix

including retail, commercial, residential and hospitality

18

64% 36%

Overview Ownership Structure Location of Properties H1 2019 Key Financial Highlights (in ₦ mn)

Revenue Minority Shareholders

Represents locations with Real estate assets

• Principal

activities of UPDC are to acquire, own develop and sell high quality serviced commercial and residential properties Loss Before Tax

(1,525) (1,032) H1 2018 H1 2019

UPDC Group Structure

Note: Transit Village Development Company Limited, Galaxy Mall and Manor Gardens are not currently active

• The joint venture companies are Special Purpose Vehicles (SPVs) set-up

between UPDC and other parties (including land owners, private equity firms and other financiers) for real estate development.

19

Entities marked red have third-party debt UPDC Hotels Limited Manor Gardens Pty Dev UPDC Metro City Limited UPDC REIT Pinnacle Apartments Dev Ltd Calabar Golf Estate Limited First Restoration Dev Co. Limited First Festival Mall Limited Transit Village Dev Company Limited UPDC PLC

UPDC Hotels Limited is the beneficial owner

• f the Golden

Tulip in Festac

Incorporated in

• 2002. Jointly
• wned by UPDC

Plc and Top Services Limited 95% 68% 60% 62% 51% 51% 51% 45% 40%

JV / Associates Subsidiaries Subsidiaries

Transit Village Development Company Limited

Joint Ventures Overview Associates

• Although the Company has more than a 50% equity stake in

UPDC REIT, it is not treated as a subsidiary in UPDC’s financial statements because the Company does not have management control.

REIT

UPDC Financial Overview

Note: (1) Liabilities at JV company level not included

Total Assets (in ₦ mn) Total Liabilities (in ₦ mn) (1) UPDC’s Revenue to Loss Before Tax Bridge – H1 2019 (in ₦ mn) Commentary

• Since 2016, UPDC has generated losses on account of its heavy debt

burden

• Over the years, UPDC sold assets to meet obligations; however, given

the quantum of debt, external injection of capital is required to materially reduce leverage

• UPDC historically relied on commercial paper (CPs) issuance to meet

its obligations, with total CPs outstanding increasing from ₦10.4bn in 2014 to ₦14.3bn by 2018

• In 2018, UPDC took mark-to-market adjustments on its portfolio and

recorded losses on asset sales, which led to ₦8.9bn in non-cash expenses

20

68,088 71,961 70,904 64,578 46,467 44,832 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Jun-19 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Jun-19 25,987 25,825 28,339 21,921 20,754 19,684 6,048 10,561 8,540 9,019 7,658 8,382 Interest bearing liabiltiies Non-interest bearing liabilities

UPDC Asset Mix (H1 2019)

Note: (1) Investment Properties and Assets Under Construction have assets worth ₦634mn and ₦ 811mn respectively with title and litigation challenges

21

• Comprises residential, commercial, retail

and land properties

• UPDC derives rental income from its

investment properties

Investment Properties (1) – 6%

UPDC REIT 46% Assets Under Construction 16% Receivables 11% Other Assets 2% UPDC Hotels 19% Investment Properties 6% Joint Ventures 0%

• UPDC Hotels is a subsidiary of UPDC.
• It owns Golden Tulip in Festac

UPDC Hotels Limited – 19%

• Other assets include property, plant &

equipment, intangibles and cash

Other Assets – 2%

• 60% represent advances to JVs which are

backed by real assets

• Other receivables primarily relate to asset

sales, rent and service charge

Receivables – 11%

• Includes residential, commercial, office and

mixed-use properties being developed for sale

Assets Under Construction (AUC) (1) – 16%

• The REIT assets comprises of 7 properties and

the carrying value is based on UPDC’s share

• f REIT NAV
• The REIT's income comprises rental income

from the property assets and interest earned from short term investments in money market instruments and other real estate-related assets

UPDC REIT – 46%

• The JVs are Special Purpose Vehicles set up

between UPDC and other parties for real estate developments

Joint Ventures (JVs)

1 2 3 4 5 6 7 As at 30 June 2019, UPDC had c.₦45bn in total assets. UPDC’s major assets are investment in UPDC REIT, UPDC Hotels Limited, Assets Under Construction (AUC) and Investment Properties

UPDC’s loan obligations totalled c.₦21bn as at July 2019

Note: (1) Guarantee of US$2mn converted at ₦ 362.32:$1 as at 23 August 2019 (2) UAC’s shareholder loan to UPDC is at an initial rate of 5%, escalating to 15% after 180 days (3) Weighted average

22 Facility Interest Rate Tenor Dec 2018 (N mn) June 2019 (N mn) July 2019 (N mn)

Intra-group Working Capital c.15.5% n.a. 2,195 524 212 12-month Bridge Loan from UAC 5%/15% (2) 12 months

• 7,652

15,843 Liquidity Support Facility NIBOR+5.00% 12 months 6,120 7,245

• Commercial Paper

14.98% (w.ave)(3) 4 – 6 months 8,174

• Bonds

16.00% 3 - 5 years 4,264 4,264 4,355 SUB TOTAL 20,754 19,684 20,319 UPDC’s Guarantee of Festival Mall Loans (1) 725 725 725 TOTAL 21,479 20,410 21,044

• As at July 2019, third-party exposure is limited to the corporate bond (21% of direct obligations, down from 90% as at Dec-18)
• Aside these debt obligations, joint venture companies also have amounts outstanding to banks and trade creditors (of which only the Festival Mall debt is

partially guaranteed by UPDC)

Commentary

UAC’s Exposure to UPDC Obligations

Notes: (1) Loans from related parties (2) Maximum guarantee on commercial paper (CP) program was ₦ 11 bn (3) Bank facility from FBNQuest and Coronation Merchant Bank

• UAC’s exposure to UPDC was ₦10.8bn as at Dec 2018, with a further ₦4.5bn in potential exposure
• UAC provided a ₦15.8bn, Secured 12-month bridge loan to UPDC to redeem its short-term debt obligations and manage escalation of Group exposure
• Net proceeds from the rights issue are expected to be utilised to reduce UPDC’s interest bearing obligations to only the corporate bond

23

₦ mn, unless otherwise stated 31 Dec 2018 30 Jun 2019 31 Jul 2019 Direct loans 1,432 7,652 15,843 Group company loans (1) 774 524 212 Direct Exposure 2,205 8,176 16,035 Corporate bond guarantee 2,132 2,132 2,132 Drawn commercial paper guarantee 6,475

• Contingent Exposure

8,607 2,132 2,132 Total (Direct + Contingent) 10,812 10,310 18,167 Undrawn commercial paper guarantee (2) 4,525

• Total Potential Exposure

15,337 10,310 18,167 Liquidity Support Facility (outstanding)(3) 6,120 7,245

Mark-to-Market effect of UPDC REIT at current listed values

Notes: (1) As at 5 September 2019

24

Non-cash mark-to- market adjustment(1)

• f the carrying value
• f UPDC REIT

UPDC H1 2019 NAV Bridge – Total Assets to Adj. NAV (in N mn)

UPDC REIT Overview

UPDC REIT Financial Overview

Source: S&P Capital IQ, Company Financial Statements Notes: (1) Includes gain on fair value adjustments

Total Assets (in ₦ mn) Net Asset Value (in ₦ mn) UPDC REIT Profit After Tax (in ₦ mn)(1) Commentary

• UPDC REIT is a close-ended property fund with underlying assets

comprising a diversified portfolio of commercial and residential real estate assets

• The REIT is invested in seven (7) major investment properties located

in Lagos, Abuja and Aba

• In 2018, the properties earned gross rental income of ₦1.3bn. The REIT

also earned interest income of ₦837mn from cash and short-term

• investments. Reported PAT was c.₦2.6bn (after fair value gains)
• UPDC REIT paid aggregate dividends of ₦1.3bn in 2018, a c.10% yield

26

30,927 32,974 31,991 31,448 32,584 34,708 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Jun-19 30,032 31,047 30,852 31,239 31,726 33,498 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Jun-19 2,990 1,512 2,208 2,645 Dec-15 Dec-16 Dec-17 Dec-18

Unpacking UPDC REIT Market Value

27 Market Capitalisation Bridge (in N mn)

Commercial Property 45% Residential Property 38% Other Property 1% Liquid Assets 15% Other Assets 0.4%

UPDC REIT Asset Mix (H1 2019)

Note:1 – Federal Government of Nigeria

28

Commercial Property – 45%

1

Residential Property – 38%

2

• Holdings in FGN1 treasury bills bills and

Investment-grade commercial papers issued by Nigerian corporates

Liquid Assets – 15%

5

• Furniture and fittings; and other property

related assets

Other Assets – 0.4%

6 As at 30 June 2019, UPDC had c.₦35bn in total assets

Property Carrying Value (₦ bn) 2018 Rental Yield VMP 2 9.8 10.9% Abuja Complex 1.6 5.4% 1-2 Factory Road 0.8 5.3% Kingsway Building 3.4 5.7% Property Carrying Value (₦ bn) 2018 Rental Yield VMP 1 9.1 2.0%

Abebe Court

4.1 4.2%

Other Property – 1%

3

• Student accommodation (hostels) with

carrying value of ₦0.4 bn

Real Estate Strategic Initiatives

UPDC Initiatives (1/2)

30

1

The ₦15.96bn Rights Issue to repay short-term debt

UPDC UAC UPDC Public Shareholders

64% 36%

• UPDC requires equity to improve its capital structure
• Focus is on reducing debt to levels serviceable from

recurring cash flows

• Expected to raise ₦15.96bn from the Rights Issue, where

net proceeds will be used to paydown the 12-month bridge loan

• Only outstanding debt at UPDC will be the c.₦4.3bn

corporate bond

• Successfully completing the Rights Issue will materially

improve UPDC’s capital position

UPDC issues shares to its shareholders UPDC issues shares to its shareholders

UPDC Initiatives (2/2)

31

Notes: (1) As a result of the UAC Unbundling, UAC shareholders will also directly hold UPDC REIT units. Ultimate shareholding and unitholding in UPDC and UPDC REIT respectively will be determined post the Rights Issue

2

UPDC will unbundle its interest in UPDC REIT to its shareholders

UPDC UAC UPDC Public Shareholders

64% 38% Key benefits

• Increase in free float and potentially improve liquidity in the REIT units
• Release of value to shareholders
• UPDC REIT is profitable and has market capitalisation of

₦13.1bn, NAV of ₦33.5bn and paid ₦1.3bn in dividends in 2018

• Also has a consistent track record of dividend payments,

which UPDC shareholders will now benefit directly

UPDC REIT UPDC REIT Public Shareholders

62%

UPDC REIT UPDC Public Shareholders UPDC REIT Public Shareholders UAC Shareholders UAC Shareholders

100%

Pre-Unbundling Post-Unbundling

36% 38% 62%1

UAC Initiatives

32

Notes: (1) As a result of the UAC Unbundling, UAC shareholders will also directly hold UPDC REIT units. Ultimate shareholding and unitholding in UPDC and UPDC REIT respectively will be determined post the Rights Issue

UPDC UAC

64% The UAC Unbundling aims to streamline UAC’s corporate structure and ensure focus on its core

• sectors. Envisaged benefits of the unbundling include
• Deconsolidation of a business (i.e. UPDC) that has a different cashflow profile and capital needs

from the rest of UAC’s portfolio

• Increased management focus on the rest of UAC’s portfolio
• In addition to owning shares in UAC, UAC Shareholders will also own shares in UPDC and units in

the REIT, providing shareholders with investing flexibility

• By virtue of their ownership of UPDC REIT units, each shareholder of UAC will have a direct

exposure to the REIT which has paid dividends in every year since its establishment

• Positions UPDC to thrive as a standalone entity targeting appropriately structured capital and

pursuing growth initiatives

UPDC REIT UAC Shareholders

100%

Pre-Unbundling Post-Unbundling1

62%

UAC Shareholders UPDC UAC UPDC REIT

100% 64%1 39%1

Repositioning UPDC

UPDC Update

34

• We have made progress in our efforts to position UPDC for growth, post recapitalization
• Strengthened management teams at UPDC and UPDC Hotels Limited (our Hospitality Asset)
• Reduced operating cost
• Improve cash management
• Efforts are ongoing to further strengthen UPDC’s governance and management
• UPDC’s strategic priorities are anchored on:
• 1. Repositioning the portfolio: continue to harvest capital from low yielding projects (c. ₦4bn year-to-date).

Liquidity will be utilised to redeem the corporate bond and invest for growth

• 2. Improve Hotel Performance: historical stance has been to sell the hotel with limited focus on interim
• ngoing performance. Focus is on getting the hotel to profitability
• 3. Invest in yielding assets: currently exploring developments with initial cash on cash yield of >10%. UPDC

will focus on assets with guaranteed offtake/attractive initial yields

Recent additions to the UPDC management team

35

• Mrs. Deborah Nicol-Omeruah

Chief Commercial Officer

• Mrs. Folakemi Fadahunsi

Finance Director

• Mr. Kevin Teeroovengadum

Senior Advisor Joined February 2019 Joined March 2019

• 19 years of experience across consumer

markets, telecommunications and the public sector

• Prior roles include Senior Manager,

Advisory at PwC Nigeria and Enterprise Control & Compliance Manager for Honeywell Group

• MBA (Finance), Manchester Business

School; Fellow of the Institute of Chartered Accountants of Nigeria

• 17 years experience working in the wealth

management and property finance space

• Prior roles at Broll Property Group,

Landmark Africa, Stanbic IBTC Bank, Lloyds and HSBC Bank

• Certified Mortgage and Financial Adviser

(CeFA, CeMAP) and BArch Architecture, University of Nottingham

• Deal making experience in various sectors

in Africa for the last 19 years

• Co-Founder of ProptechAfrica
• Prior roles include Director at Actis focusing
• n Africa Real Estate, Founder CEO of

AttAfrica

• Chairman of the Board of Radisson Blu

Azuri Resort & Spa and Radisson Blu Poste La Fayette Resort & Spa

Joined April 2019

Revamped management team at UPDC Hotels

36

• Mrs. Ada Aniagu

Chief Financial Officer

• Mr. Roderick Peck

General Manager

• Mrs. Ijeoma Ugamah

Sales & Marketing Manager Joined September 2019 Joined August 2019 Joined April 2019

• Extensive experience working in the

hospitality industry across 3 continents

• Prior roles include GM, RLI Kendeja Resort

& Villas, Liiberia; GM Corinthia Hotels, Syria, Egypt and Gambia; Rex hotels, Kenya; and Corus hotel, UK

• BA Hotel and Catering Studies,

Bournemouth University

• Seasoned finance professional
• Prior roles include Head of Finance,

Transcorp Hotels and Senior Audit Associate, PwC Nigeria

• Member of the Association of Chartered

Certified Accountants (ACCA) with a B.A degree in English & Literary Studies from the University Nigeria

• Experienced sales and marketing

communications manager

• Prior roles include Group Sales & Marketing

Manager at Curzon & Jones; National HORECA manager at Diageo and Sales Manager at Intercontinental Hotel Lagos

• M.Sc. Marketing Communications and

Public Relations from the University of Chester

Strategic focus of UPDC Hotels Limited

37

• UPDC’s historical stance was to sell the hotel with limited focus on short-term
• ngoing performance. Our strategic focus is now to return the hotel to

profitability

• The critical pieces to the future performance of the hotel are
• addressing energy costs (c.40% of revenue)
• improving occupancy
• Energy costs have been a major drag on performance. Adopting energy

efficiency initiatives will lead to improvements in profitability

• Initiatives to drive occupancy include
• Increased marketing efforts with a focus on the conferencing segment

and corporates in its immediate proximity

• Exploring alternative access to the hotel via waterways

Strategic plans Overview

• UPDC Hotels Limited, a subsidiary of UPDC Plc (95%

stake), owns the Festac 77 Hotels, also known as Golden Tulip Hotels, a 471 room hotel with 9 conference rooms and a banquet hall

Packaged Food and Beverages

27% of operating income

Snapshot of UAC Foods

39

• Leading Nigerian packaged food and beverages company
• UAC Foods manages a family of brands across several product

categories

• Snacks: Gala and Funtime
• Dairy: Supreme
• Water: Swan
• The company is owned by UACN (51%) and Tiger Brands (49%),

Africa’s largest packaged food & beverages company which became a minority shareholder in 2010

Revenue Gross Profit

51% 49% Overview Ownership Structure Leading Product Portfolio H1 2019 Key Financial Highlights (in ₦ mn)

70% 19% 11% 72% 21% 7%

8,323 2,368

Snacks Water Dairies Snacks Water Dairies

Snacks

• Since its inception in 1962, Gala has grown to become

the #1 player in the long-shelf life sausage roll segment

Dairy

• Supreme, which dates back to 1994, is the company’s

dairy brand. It is the #2 player within the mass-market ice cream segment

Water

• Swan, which was launched in 1983, pioneered bottled

water in Nigeria. Leading player in the spring water segment.

Significant brand equity across the portfolio

40 Products Brand Equity Score(1)

45.8 12.5 10.8 9.8 5.6

Gala #2 Player #3 Player #4 Player #5 Player 43.2 39.1 10.4 1.8 1.8 #1 Player Supreme #3 Player #4 Player #5 Player

Brands

Nationwide Nationwide Northern Nigeria Source: (1) Kantar MillwardBrown

31.9 25.9 14.8 12 4.8 Swan #2 brand #3 brand #4 brand #5 brand

At UAC Foods we have demonstrated our ability to drive margin expansion

41 Key value creation initiatives till date: We have demonstrated our ability to drive margin expansion via operational improvements even in a low growth macro environment. We believe this can be replicated elsewhere in the portfolio UAC Foods EBIT Margin Bridge (H1 2018 to H1 2019)

Production and route-to-market

• Improved product quality and consistency
• Expanded product availability across existing and new

markets

• Launched marketing campaigns to strengthen brands

Raw material cost reduction and improved material management

• Achieved critical price reduction in raw material costs per

unit by renegotiating procurement contracts

• Reduced production material losses from >3% to less than

1% on a weight basis Operating efficiency

• Invested in factory and equipment upgrades to improve

throughput and efficiency

• Began off-take from new IPP provider to improve factory

efficiency

• Improved maintenance of plant and machinery

HR reward and capability

• Introduction of pay for performance bonus scheme
• Five fold increase in training expenditure

Improved use of ERP system

• Improved managerial reporting for tracking, control and

insight Additional cost of revamped Exco

Value Creation Focus – Optimise and grow

42 Growth

• Expand route-to-market and drive sales in existing and new markets
• Launch marketing and promotion campaigns to reinforce brand equity
• Explore brand extension and product development opportunities

Operations

• Invest in new automated plant to drive efficiency, quality and consistency
• Increase production capacity (Snacks & Water) and cold chain infrastructure (Dairy) to improve national reach

and cater for future growth

• Monitor procurement costs to improve savings

35% of operating income

Paints

Snapshot of the paints segment

Overview Brands Market position by value H1 2019 Key Financial Highlights (in ₦ mn)

CAP PLC

• Public company listed on The NSE
• Produces decorative paint and sells through a dedicated distribution

network

• Technology licensee and distributor for AkzoNobel in Nigeria

Portland Paints

• Public company listed on The NSE
• UAC acquired Portland Paints in 2013 to establish market presence in

the industrial segment

• Distributor for Hempel’s industrial products in Nigeria

44

AkzoNobel Other Partners Owned Brands Revenue Gross Profit

92% 8%

5,235

83% 17%

2,364

Industrial Decorative Decorative Industrial

#2 #5

Business Model

Central Plant in Ikeja

• Manufactures 12 products lines, comprising 1,400 individual

products with annual processing capacity of 14.4 mn litres per annum

• Operates automated and technologically advanced

production equipment on the Dulux emulsion line with plans to extend to other lines

• Recently commenced contract manufacturing for Portland

Paints

Unique distribution model

• Network of dedicated franchised retail outlets – “Dulux Colour

Centres” and “Sandtex Experience Centres” – across 13 states. Currently 86 franchised outlets

• Formalised retail channels
• Direct corporate sales

45 Production Distribution

Represents locations with Colour centres

Value Creation – Grow

46

Historical success in driving premium strategy with ROIC of 45.6%. Focus on driving value growth and simplifying structure

Deepen Retail Penetration

• Expand franchised distribution network
• Invest in upgrades
• Explore third-party distribution

Consolidate Premium Brands; Expand Range

• Review positioning of multiple brands in the premium segment
• Expand value offering
• Grow industrial category

Optimise ownership, procurement, production and route-to-market

CAP Minorities Portland Minorities 48% 52% 85% 15%

Animal Feeds and Other Edibles

25% of operating income

Snapshot of the animal feeds segment

48 Overview

• Private company
• Produces animal feed, cereals, oils and dogfood
• Core brands are Vital and Grand
• Caters to commercial farmers across Nigeria
• Public company listed on The NSE
• Produces animal feeds and distributes full fats soya
• Core brands are Livestock Feeds and Aquamax
• Sells to commercial farmers largely in Southern Nigeria

Market Position

• #2 player in Poultry Feed
• #1 player in Fish Feed
• #7 player in Poultry Feed
• Growing fish feed business

Key Products Poultry Feed

• Poultry feed produced and sold to commercial broiler and

layer farmers

Fish Feed

• Fish feeds targeted at Nigeria’s growing domestic

aquaculture market

Other Edibles

• GCL also produces a number of higher-margin branded

edible products such as oils, cereals, dog food and cornflakes

Revenue Gross Profit

H1 2019 Key Financial Highlights (in ₦ mn)

75% 10% 15%

23,284

Poultry Feed Fish Feed Other

65% 12% 23%

Poultry Feed Fish Feed Other

2,534

Value Creation Focus - Optimise

49

1 2 3 4 5

2 GCL LSF

LSF Minorities GCL Minorities

71% 29% 73% 27% Consolidate ownership and operations Streamline production facilities Focus on margin improvement, rationalizing excess capacity and unlocking capital Margins

• Improve procurement processes to leverage combined scale for direct sourcing. ₦100m expected savings from amino

acids procurement in 2020

• Improve production and conversion processes; potential for margin improvement from investing in solvent extraction

and energy efficiency

• Explore concessionary funding sources

Unlock Capital

• Optimise procurement across GCL and LSF to reduce working capital requirements
• Rationalise excess capacity to free up capital for higher ROIC projects

Logistics

14% of operating income

Snapshot of MDS Logistics

• MDS was founded in 1965 to provide warehousing services to GBO,

which at the time was UAC’s merchandising division

• The company has shifted focus over time to become a third-party

logistics provider

• UAC sold a 49% stake in MDS in 2013; currently in the process of

selling a further 8% at a $40mn valuation

• Imperial Logistics is the largest transportation management

company in Southern Africa, with more than 5,000 vehicles

51

57% 43%

Overview Ownership Structure (post-sale) Warehouse Footprint Strategic Rationale for sale to imperial

Sokoto

Katsina

Kano Gusau Zaria

Jos Suleja Bida Minna Abuja (FCT) Gombe Maiduguri Oyo

Oshogbo

Ibadan Abe okuta Lagos Ado-Ekiti Akure Ondo

Ijebu-Ode

Sapeie Benin Warri Lokoja Enugu Onitsha Owerri Umuahia Calabar Makurdi Aba Uyo Port harcourt Jalingo Yola llorin

• A strategic rationale for partnering with Imperial is to leverage

Imperial’s experience in transportation, a segment with growth potential

• Allows MDS to benefit from Imperial’s global capabilities
• This will enable MDS focus on leveraging its assets, technology and

capabilities to deliver value to its clients

• MDS will be able to broaden its logistics offering from warehousing,

haulage and distribution to include international freight forwarding and value-added services to clients across several sectors

Strategic Business Units

52

Warehousing Haulage Distribution

• 51 warehouses across Nigeria;

increased focus on managing client-owned locations.

• Rigorous portfolio assessment to

minimize un-profitable locations.

• Haulage services typically

involve long haul transportation across Nigeria.

• Served with a mix of company-
• wned and leased >30-ton

articulated vehicles. .

• Services are typically short-and

medium haul transportation

• Served with 25 medium chassis

vehicles and pick-up trucks with up to 12-ton capacity

Warehouses 70% Distribution 7% Haulage 23%

Revenue

2,446

H1 2019 Key Financial Highlights (in ₦ mn) Overview

Warehouses 93% Distribution 4% Haulage 3%

723

Gross Profit

Value Creation – Optimise and Grow

53

Warehousing

• Optimise network of owned warehouses and pursue opportunities to manage third-party warehousing
• perations; Expand on recent success in providing logistics services to FMCG players using client assets
• Rationalise unprofitable locations

Transportation

• Expand transportation offering by acquiring fleets dedicated to large corporates and backed by fixed / variable

rate contracts

• Expand transportation and maintenance capabilities as well as innovation to optimise owned and outsourced

fleet

Broaden logistics offering from warehousing, haulage and distribution to include international freight forwarding and value-added services

Pre-deal

• Warehouse management
• Transportation management

Post-deal

• Warehouse management
• Transportation management
• Value-added logistics services
• International freight management
• Ancillary business activities which complement the traditional

warehousing services such as inventory management, sales administration, distribution management, information management and credit control administration

Quick Service Restaurants

0.1% of operating income

Snapshot of UAC Restaurants

55

• UAC Restaurants (UACR) pioneered QSR in Nigeria with the launch of

Mr Bigg’s in 1986

• In addition to the Mr Bigg’s chain, UACR also operates the Debonairs

Pizza brand in Nigeria

• UACR has historically pursued a franchise strategy
• UACR revenue sources include royalty and food services income from

franchised outlets as well as from corporate store sales UACR Operates Two Distinct Brands Overview Ownership Structure

6 1 1

5

1 3 4 1 2 1 3

7

2 1

90 outlets across Nigeria

Truly National Footprint

• Indigenous Nigerian fast-food chain that serves local as

well as western cuisine

• Low-cost, family-friendly offerings targeting the mass-

market

• High quality offerings targeting discerning pizza lovers
• Ongoing effort to grow footprint

51% 49%

Strategic review on optimizing asset and footprint

56

• Fast-growing and young population
• Rapid levels of urbanization
• Busier lifestyles leading to more fast-food consumption
• QSR more competitive than casual and full service dining
• ptions in terms of price and meal sizes

# of Outlets

National Footprint… …With Attractive Growth Drivers

90 69 59 47 #2 Player #3 Player #4 Player

Strategic Initiatives

• Recently launched first company-owned store featuring counters for both brands
• Commencing franchise portfolio rationalization to achieve the following:
• Enhanced brand perception
• Improved unit economics
• Uplift in royalty income
• Working closely with Famous Brands to define long-term growth objectives

H1 2019 Performance

UAC H1 2019 Performance Overview

• Annualized EPS of 112 Kobo, up 75.6% Y-o-Y
• Annualized ROIC of 4.5%, up 16 bps Y-o-Y
• H1 2019 revenue of N41.6bn up 12.4% Y-o-Y
• H1 2019 operating profit of N3.0bn (7.1% margin) up 9.3% Y-o-Y
• Operating profit margin down 20bps Y-o-Y due to:
• One-off loss (N104mn) on disposal of investment properties by UPDC
• Higher marketing and personnel expenses in the paints businesses
• Higher direct costs in the logistics business
• H1 2019 performance positively impacted by revenue growth as a result of market share recovery in the animal feeds and other edibles

segment and operational improvements in the packaged food and beverages segment

• Free cash flow of N5.0bn for H1 2019 compared with (N0.6bn) for H1 2018
• In the process of divesting 8% of MDS to Imperial Logistics at a $40mn valuation
• UAC has extended loans of N16.0bn to UPDC and plan to recapitalize UPDC via a rights issue to significantly reduce leverage and exit the

business via an unbundling to shareholders 58

Income Statement – H1 2019

59 Summary income statement N mn, unless otherwise stated H1 2019 H1 2018 D% Revenue 41,569 36,982 12.4% Gross Profit 8,634 7,565 14.1% Gross Profit Margin (%) 20.8% 20.5% 31.5 bps Operating Profit 2,971 2,718 9.3% Operating Profit Margin (%) 7.1% 7.3% (20.3 bps) Net Finance Cost (164) (1,077) (84.8%)

• Incl. Finance income

1,655 1,335 23.9%

• Incl. Finance cost

(1,819) (2,412) (24.6%) Profit Before Tax 3,392 2,102 61.3% Annualised Basic Earnings per share (Kobo) 112 64 75.6% ROIC 4.5% 4.4% 16.9 bps

• Growth in revenue primarily driven by animal feeds and other edibles segment
• PBT growth on account of increased sales, operational improvements from packaged food and beverages and lower net

finance costs

• Operating profit margin down as a result of higher marketing and personnel costs in the paints businesses, higher direct costs in

logistics and a one-off loss in UPDC

Financial Position – H1 2019

*Leverage ratio calculated as Net debt / EBITDA; where EBITDA is Operating profit plus depreciation and amortisation

• Net Working Capital calculated as Inventory plus Receivables minus Trade payables
• Debt figure in Group adjusted for intra group transaction

Summary Balance Sheet Cash/Leverage H1 2019 Working Capital Capex H1 2019 60

N mn H1 2019 FY 2018 D% Non current Assets 52,954 50,777 4.3% Current Assets 63,770 71,042 (10.2%) Other Assets 8,407 9,274 (9.3%) Total Assets 125,132 131,093 (4.5%) Long term debt 7,840 4,501 74.2% Short term debt 9,162 19,672 (53.4%) Other Liabilities 32,455 32,713 (0.8%) Total Liabilities 49,457 56,885 (13.1%) Net Asset Value 75,675 74,208 2.0% N mn H1 2019 FY 2018 D% Inventory 26,187 30,526 (14.2%) Receivables 11,158 10,234 9.0% Trade Payables 12,846 15,438 (16.8%) Net Working Capital 24,499 25,322 (3.3%) Inventory Days 143 187 (23.4%) Receivables Days 48 50 (3.0%) Trade Payables Days 70 94 (25.7%) Cash Cycle (Days) 121 142 (14.7%) N mn CAPEX Depreciation CAPEX / Dep. HoldCo 85 81 1.1 Paints 170 108 1.6 Packaged Food and Beverages 396 298 1.3 Real Estate 1 15 0.1 Animal Feeds and Other Edibles 240 311 0.8 QSR 59 53 1.1 Logistics 109 132 0.8 Total 1,059 998 1.1 N mn Cash Debt Net Debt

• Lev. Ratio *

HoldCo 8,179 0.0 (8,179) n/a Paints 3,205 0.0 (3,205) n/a Packaged Food and Beverages 4,091 0.0 (4,091) n/a Real Estate 410 19,380 18,970 (618) Animal Feeds & Other Edible 866 6,026 5,160 4.6 QSR 173 0.0 (173) n/a Logistics 1,091 0.0 (1,091) n/a Total 18,014 25,406 7,392 1.9

Cash Flow – H1 2019

61

• Better cash management overall as cash cycle improved 15% to 121 days in H1 2019 from 142 days in H1 2018
• Receivable days down to 48 days in H1 2019 from 50 days in H1 2018 as a result of improved cash collection by subsidiaries
• Inventory days down to 143 days from 187 days on account of improved conversion to sales and lower stock levels in the animals feeds and other

edibles segment

• Payables decline to 70 days from 94 days on account of increased cash purchases and timing of inventory acquisition in the animal feeds and
• ther edibles segment compared to prior year

H1 2019 Free Cash Flow Bridge (in ₦ mn)

N mn H1 2019 H1 2018 D% Animal Feeds & Other Edibles 23,284 18,961 22.8% Paints 5,235 5,262 (0.5%) Packaged Food and Beverages 8,323 8,345 (0.3%) QSR 713 611 16.7% Logistics 2,446 2,557 (4.3%) Real Estate 1,457 1,156 26.0%

Performance Snapshot – H1 2019

Figures above exclude those of Corporate Centre

Revenue Operating Margins Profit before Tax Return on Invested Capital 62

N mn H1 2019 H1 2018 D Animal Feeds & Other Edibles 3.5% 3.4% 4 bps Paints 21.5% 24.9% (334 bps) Packaged Food and Beverages 10.7% 7.2% 344 bps QSR 0.6% 0.6% (2 bps) Logistics 17.8% 20.8% (291 bps) Real Estate (3.1%) 19.7% n/m N mn H1 2019 H1 2018 D% Animal Feeds & Other Edibles 121 (73) n/m Paints 1,370 1,478 (7.3%) Packaged Food and Beverages 1,173 851 37.8% QSR (12) 6 n/m Logistics 438 575 (23.8%) Real Estate (1,032) (1,525) 32.3% N mn H1 2019 H1 2018 D Animal Feeds & Other Edibles 4.7% 4.5% 19 bps Paints 45.6% 39.7% 584 bps Packaged Food and Beverages 17.2% 12.4% 481 bps QSR 0.7% 1.3% (59 bps) Logistics 9.7% 12.8% (318 bps) Real Estate (0.3%) 1.3% n/m

Group Treasury Position

Notes: 1 – Includes ~N1bn proceeds from disposal of non-core assets

63

Cash & Cash Equivalents Short-Term Debt Long-Term Debt Net Cash (excl. Intra- Group) Intra-Group Receivable / (Payable) Net Cash (incl. Intra- Group) UAC Company1 9,564

• 9,564

16,357 25,921 Other Operating Segments 9,390 (4,994)

• 4,395

(321) 4,074 UPDC Plc 616

• (4,355)

(3,739) (16,035) (19,774) Total 19,570 (9,162) (7,840) 10,221

• 10,221

Group Net Cash Position as at 31 July 2019 (in ₦ mn)

Risks to Outlook

Challenging macroeconomic and industry conditions present risks to the outlook

65 Government, Labour Disagree On Minimum Wage

NIGERIA DAY

No plan to remove fuel subsidy, FG insists

NIGERIA DAY

Villagers Flee As Violence Erupts in Jos, Threatens Economic Activity

NIGERIA DAY

50 100 150 200 250 300 350 400 450 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Secondary Market Official Rate

Currency depreciation remains a key concern

Source: EIU

66 Nigeria Naira to US Dollar Official Exchange Rate

₦362/$1 ₦306/$1

20-year CAGR Official rate 6.5% Secondary Market 7.0%

Conclusion

Conclusion

68

• UAC’s strengths include its
• Strong brands and market presence
• Exposure to attractive markets
• Strong management teams
• Management is focused on driving earnings growth with
• Operational improvements to support margin expansion
• Investment in targeted growth industries
• Our core strategic focus relies on
• People and governance
• Structure
• Returns
• We made meaningful progress in H1 2019 with earnings up 75.6%
• Recapitalising and exiting UPDC are key priorities

Appendix

Q2 2019 Performance

Income Statement – Q2 2019

Notes: 1 – Includes ~N1bn proceeds from disposal of non-core assets

70 Summary income statement N mn, unless otherwise stated Q2 2019 Q1 2019 D% Revenue 20,944 20,625 2% Gross Profit 4,177 4,457 (6%) Gross Profit Margin (%) 19.9% 21.6% (166.9) bps Operating Profit 1,480 1,491 (1%) Operating Profit Margin (%) 7.1% 7.2% (15.8) bps Net Finance Cost (155) (8) 1753%

• Incl. Finance income

715 940 (24%)

• Incl. Finance cost

(870) (948) (8%) Profit Before Tax 1,910 1,482 29% Annualised Basic Earnings per share (Kobo) 124 100 23% ROIC (annualised) 4.4% 4.7% (35.5) bps

• Revenue increased 2% Q-o-Q primarily driven by the animal feeds and other edibles segment
• Gross profit margin declined 167 bps due to high soya input costs in the animal feeds and other edibles segment; while the

packaged food and beverages as well as paints businesses saw higher raw material conversion costs

• Operating declined marginally (16 bps) due to operational efficiencies which resulted in Selling & Distribution expenses

declining 6.1% Q-o-Q and Administrative expenses declining 2.3% Q-o-Q

Performance Snapshot – Q2 2019

71 Revenue Operating Margins Profit Before Tax Return on Invested Capital

N mn Q2 2019 Q1 2019 D% Animal Feeds & Other Edibles 11,920 11,364 4.9% Paints 2,340 2,895 (19.2%) Packaged Foods 4,084 4,239 (3.7%) QSR 377 336 12.2% Logistics 1,199 1,247 (3.8%) Real Estate 1,457 484 200.9% N mn Q2 2019 Q1 2019 D% Animal Feeds & Other Edibles (1) 122 (100.8%) Paints 540 830 (34.9%) Packaged Foods 568 605 (6.1%) QSR (16) 3 (596.9%) Logistics 142 296 (52.0%) Real Estate (1,032) (968) n/m N mn Q2 2019 Q1 2019 D% Animal Feeds & Other Edibles 2.7% 4.3% (166.1 bps) Paints 17.9% 24.5% (658.5 bps) Packaged Foods 10.3% 11.0% (75.6 bps) QSR 1.1% 0.1% 93 bps Logistics 14.8% 20.8% (600.8 bps) Real Estate (3.1%) (47.9%) 4,481 bps N mn Q2 2019 Q1 2019 D% Animal Feeds & Other Edibles 3.6% 6.7% (307 bps) Paints 31.4% 37.3% (586 bps) Packaged Foods 15.7% 17.8% (210 bps) QSR 1.4% 0.3% 107 bps Logistics 7.7% 11.9% (415 bps) Real Estate (0.6%) (1.5%) 94 bps